Gold targets $5,400 as debt risks and weak dollar revive bullish case

Gold, which reached an all-time high of nearly $5,600 earlier this year, has faced intense selling after its worst quarterly performance in a decade, also described as its worst since 2013, during the three months through June. The metal is now rebounding and repairing the technical breakdown, while long-term structural deficits, rising global debt, volatile U.S. long-term Treasury yields and a weaker dollar support the bullish case. Wall Street is targeting $5,400 an ounce over the next 12 months, although analysts warn that macroeconomic headwinds and short-term correction risks remain. UBS commodities analyst Giovanni Staunovo said rising global debt and dollar weakness helped lift gold last year and are returning as supportive forces.

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