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Societe Generale is “cautiously bullish” on gold prices, looking for the metal to average $1,250 an ounce in the fourth quarter and $1,275 in the first quarter and for all of 2019.

The bank released an updated forecast Thursday ahead of next week’s gathering of the London Bullion Market Association. The bank said its outlook has not changed materially since the one issued a month ago.

As of mid-afternoon on Thursday, spot gold was $5.10 softer to $1,228.10 an ounce.

Gold has been back above $1,200 an ounce for the last two weeks, helped by safe-haven buying due to weakness in global equities and geopolitical tensions, said the report, written by metals analyst Robin Bhar.

“Gold’s impressive performance of late, coming amid USD [U.S. dollar] strength, suggests that gold finally is behaving like a safe-haven asset,” the report said.

The rally came amid inflows into gold-backed exchange-traded funds, Bhar pointed out. Furthermore, he continued, there has been a pickup in gold purchases by central banks, including Hungary, Poland, India, Turkey and Mongolia, in addition to regular gold buyers Russia and Kazakhstan.

“We are cautiously bullish on gold prices on the premise that current prices are oversold and reflect a significant short position in the speculative market, which we see as transitory,” the report said.

“Price dips are likely to be well supported [as] longer-term investors continue to be attracted to gold as a means of diversification and to hedge against rising uncertainty across other asset classes,” the report continued.

Still, the report listed factors that could limit the upside.

“On the physical market, however, we expect supply to grow sequentially in both 2018 and 2019, adding 210 [tonnes] of new supply against a decrease of 82t in fabrication demand (jewelry, coins and industrial applications),” Societe Generale said. “As a result, the physical balance should continue to weigh on prices.

“Rate-hike increases and tightening liquidity in the U.S. will likely weigh on investor appetite as both the cost of carry and the opportunity cost of gold increases.”