Morgan Stanley lifts gold forecast citing central bank purchases, ETF inflows, and delayed Fed rate reductions in 2027.
Morgan Stanley increased its gold price target to $5,200 per ounce, citing resumed ETF and central bank buying alongside anticipated Federal Reserve rate cuts. The bank expects 25 basis point cuts in January and March 2027, supporting the metal’s rally.
Gold has declined 14.5% since the Iran conflict began, underperforming the S&P 500 and FTSE All-World. The drop reflects gold’s sensitivity to real yields and monetary policy rather than geopolitical risks, according to the analysis.
ETF and central bank demand paused or reversed after the conflict, with some investors selling aggressively. The bank’s bullish outlook hinges on a weakening US dollar and renewed accumulation by China and ETFs.