VIEW: UBS "exp. prices to test $1,800/oz.......>

GOLD: VIEW: UBS "exp. prices to test $1,800/oz near term, and would not rule out

a temp. break of this level. However, we remain sceptical of a sustained move

towards fresh record highs. With concern about the global econ already being

priced in & real rates at the lows, we think further macro catalysts are needed

to spark a sharp, sustained gold rally. We exp. another bout of consolidation

into year-end around the range seen for most of Q2. We keep our annual avg.

forecasts unch. at $1,650/oz over the next couple of years, although we are

increasingly mindful of the growing upside risks to our view, particularly

beyond '20. The gold mkt would be propelled higher if there is a stronger build

in gold allocations from an even broader investor base amid concerns about the

longer term impact of unprecedented stimulus on debt & fiscal balances.

Moreover, gold's appeal as a diversifier in lieu of/in addition to bonds is

gaining ground with the Fed unlikely to take policy rates -ve. A weaker growth

recovery than exp., potentially driven by further waves COVID-19 infections, is

another factor that could drive stronger interest. Finally, +ve inflation

surprises that cause further real rate compression would also push gold higher."