Reaching US$1,800 would be significant, because after gold peaked in September of 2011 at US$1,921.17 per ounce, it tested the $1,800 resistance level three times but could not reach it.

“We advise gold investors with a strong orientation towards equities to stay long the metal,” Credit Suisse’s chief investment office said in a written response to questions about gold’s outlook.

“During the current the coronavirus pandemic and in prior crises, gold has been an effective diversifier and risk reducer in balanced, growth or equity oriented portfolios. We believe these portfolio properties still justify a thematic gold allocation in a portfolio despite our forecast of limited returns for the yellow metal in our base case,” Credit Suisse said.

Credit Suisse expects the safe haven to be in the US$1,800-to-US$1,850 range at the end of the year. That’s far more conservative than the bullish analysts at Bank of America, who, in a report titled “The Fed can’t print gold” in April, said the yellow metal could shoot as high as US$3,000 per ounce in 18 months from then.

To be sure, there are sceptics. Seeing a quicker economic recovery ahead and pointing to weak demand for physical gold in Asia, Capital Economics last week predicted gold will slide back to US$1,600 an ounce by the end of the year, according to a report by Kitco News.

In addition to the coronavirus, gold has gotten a boost this year from souring relations between the US and China, negative real yields, a weaker US dollar, and stimulative steps by governments and central banks around the globe.

Meanwhile, no vaccine is available and the US, the world’s largest economy, is reeling from its worst jobs crisis since the Great Depression and a spike in infections in many states. In addition, the International Monetary Fund last week warned it sees a deeper global recession this year and slower recovery in 2021, with global output projected to decline by 4.9 per cent in 2020, 1.9 percentage points below its April forecast.

Amid so much uncertainty, investors have been snapping up gold-backed ETFs, with net inflows of US$8.5 billion racked up in May. Through May, year-to-date inflows reached US$33.7 billion, beating any calendar year in just five months, according to the World Gold Council, a gold industry group. So far this quarter, gold has gained 12 per cent, on track to record its best quarterly performance since the first quarter 2016, when it rose more than 16 per cent.

UBS Wealth Management forecasts gold to hit US$1,800 in the second half of the year, though it could see it rising to US$1,900 to US$2,000 per ounce if uncertainty returns to financial markets amid a strong second wave of infections.

“Investors, worried about ballooning fiscal deficits, particularly in the US, and financial repression being in full swing across many key economies, have turned to gold,” said Dominic Schnider, head of commodities and Asia-Pacific foreign exchange at UBS Wealth Management.

“We believe the favourable investment demand backdrop for gold is here to stay as real interest rates and real interest rate expectations in the US can go more negative .... Moreover, we expect the [US dollar] to weaken broadly as the greenback is richly valued [in terms of purchasing power parity] and offers no yield or any special economic growth story while exposing investors to twin deficits, particularly on the fiscal side,” Schnider said.

“These factors and the lack of currency alternatives for investors – other key central banks are also conducting quantitative easing as well and have rates at or below zero – are likely continue shoring up interest in gold and make the metal the ultimate currency to hold in the current environment, in our view,” Schnider said.

Stephen Innes, chief markets strategist at AxiCorp, predicts gold could reach US$2,250 per ounce by the end of the year. However, he sees it pulling back as the global economy rebounds and the coronavirus fades after a possible vaccine or herd immunity.

“Nothing lasts forever when it comes to gold,” Innes said.