Bank (UBS) has revealed its gold price forecast for the coming period, amid escalating geopolitical tensions, particularly with the ongoing war in the Middle East.

The bank clarified that the target price could reach $6,200 per ounce by the end of 2026, supported by geopolitical risks and a favorable macroeconomic environment.

Gold is currently trading at $4,500 per ounce, after declining from over $5,400 at the beginning of the war with Iran. As events escalated, the metal's price began to fall, countering an increased investor shift toward holding cash liquidity.

However, the bank believes that continued escalation of tensions between the United States and Iran could support higher gold prices, as investors turn to safe-haven assets, with gold at the forefront, when they recognize that the conflict may persist for an extended period. The U.S. military buildup also suggests the potential for prolonged conflict.

Dominic Schneider, strategic analyst at $XAUUSD UBS$BTC , stated that individual geopolitical events rarely have lasting impacts on global markets, but they serve as strong catalysts for temporary spikes in volatility, driving investors to hedge their investment portfolios, such as by investing in gold.

He added that, regardless of geopolitical factors, the underlying macroeconomic environment remains strongly supportive of non-income-generating assets.

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