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purchase gold as costs weaken, says UBS Wealth Administration – Information by Automobilnews.eu

purchase gold as costs weaken, says UBS Wealth Administration


Gold bars being forged at a plant by Gulidov Krasnoyarsk Non-Ferrous Metals Plant in Russia.

Kirill Kukhmar | TASS | Getty Photos

SINGAPORE — Buyers needs to be placing their cash in gold now, because it represents a “excellent hedge” forward of danger occasions such because the U.S. election, UBS World Wealth Administration informed CNBC.

“We like gold, as a result of we predict that gold is prone to really hit about $2,000 per ounce by the top of the 12 months,” based on Kelvin Tay, the agency’s regional chief funding officer, on Tuesday.

“And gold has sure hedges to it,” Tay stated. “In (the) occasion of uncertainty over the U.S. election and the Covid-19 pandemic, gold is a really, excellent hedge. And its current weak point represents an important entry level for traders,” he added, chatting with CNBC’s “Squawk Field.”

Gold costs have shot to report highs this 12 months — and surpassed $2,000 per ounce for the primary time in historical past. Lately, nonetheless, costs have dipped once more and final traded at round $1,880 per ounce as of Tuesday afternoon throughout Asia hours.

The valuable steel can also be engaging as a result of low rate of interest surroundings, Tay identified.

If rates of interest keep low because the Fed has indicated, the chance price of holding gold — a non-yielding asset — will likely be “fairly low,” he added. That is as a result of traders are usually not foregoing curiosity that will be in any other case earned in yielding belongings.

Tay additionally beneficial that traders put some cash into Chinese language authorities bonds as they’re set to be included in main index supplier FTSE Russell’s World Authorities Bond Index. The inclusion, from October 2021, is about to convey billions of {dollars} of inflows into China.

Tay identified that Chinese language authorities bond yields, at 2.5%, are greater than different areas, in comparison with U.S. yields at 0.6% and European yields at largely detrimental ranges.

“That is actually excessive returns for an excellent high quality authorities with very robust stability sheets,” he stated.

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purchase gold as costs weaken, says UBS Wealth Administration – Information by Automobilnews.eu
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