Gold dips near $4,020 as UBS flags key support level

Gold traded nearly flat at $4,020 per ounce in early US trading on Friday, down 0.1%, following Thursday's sharp losses, while silver fell over 1% to $54. Renewed Middle East tensions have pushed oil prices higher, raising inflation concerns and reinforcing expectations that the Federal Reserve will maintain restrictive monetary policy. Gold has struggled to attract sustained safe-haven investment despite rising geopolitical risks and weak global equity markets. UBS strategist Giovanni Staunovo identified $4,000 per ounce as a key support level where structural dip-buyers, including central banks and Chinese demand, could establish a floor and trigger a recovery. The bank maintains a positive long-term outlook for gold, citing central bank reserve diversification and concerns over rising public debt. Silver faces additional pressure as investors weigh the impact of high borrowing costs and rising energy prices on industrial activity. UBS recommends selling silver, expecting it to underperform gold even if the latter stabilizes, due to its closer ties to manufacturing and financing costs. Market sentiment remains dominated by persistent inflation risks and expectations of further Fed tightening.