On CNBC, Joni Teves of UBS said gold is attracting safe-haven interest at the moment and prices for the yellow metal could "remain elevated" amid higher geopolitical risks.
Yet gold prices are expected to revert back as geopolitical risks fade. Teves added gold prices are likely to decline toward the end of the current year amid an environment of higher real rates and the Fed tightening monetary policy.
The strength in gold prices is ”ultimately short-lived,” she added. “I think the key risk here is if we start to see reallocation into gold, with the expectation that although real rates are moving higher they are likely to remain in negative territory, and therefore an allocation to gold remains attractive,” Teves commented.
She projects gold prices declining to $1,600 an ounce by the end of year.
Price Action: At press time, gold futures traded higher by 0.6% at $1,911.60 an ounce.
