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Analysts at UBS remain optimistic on the gold-price outlook, given the prices have managed to hold onto the 1280 support zone.

Key Quotes:

“We think near-term pressure on gold is understandable.

Prices managing to hold above the $1280 support area is encouraging.

This consolidation as an opportunity to gradually build a strategic position in gold.

But for now, the extent of the dovish shift in fed expectations has made gold vulnerable to improvement in the data during a time when physical markets tend to be quieter.  

Physical demand out of China has been weak this year.

Interest out of India has been resilient.

Central bank activity has been another source of support for gold – strong net buying from 2018 has extended into this year.”