Gold to Hit $2,700 as Central Bank Demand Surges: Morgan Stanley
New York – June 8, 2025 – Morgan stanley forecasts gold prices will surge to $2,700 per ounce within the next 12 months, citing robust demand from global central banks and escalating geopolitical risks. The investment bank’s revised target, representing a more than 8% increase from current levels, reflects a growing conviction that gold’s safe-haven appeal will continue to drive prices higher.
This bullish outlook arrives as central banks worldwide are aggressively accumulating gold reserves, a trend fueled by diversification efforts and a desire to reduce reliance on the U.S. dollar. Coupled with ongoing geopolitical tensions and expectations of potential interest rate cuts by the federal Reserve, these factors are creating a potent cocktail for gold’s continued ascent. The price rally has already been significantly boosted by significant purchases from central banks and consistent inflows into gold-based Exchange Traded Funds (ETFs).
Morgan Stanley analysts point to the sustained buying by central banks as a key driver, noting a shift in global monetary policy towards de-dollarization. This strategic move by nations to hold option reserve assets is bolstering gold’s essential value. Furthermore, the anticipation of interest rate reductions later this year is expected to diminish the opportunity cost of holding non-yielding assets like gold, further stimulating investment.
Gold has historically served as a hedge against inflation and economic uncertainty,and its performance in recent months underscores this role. As of June 8, 2025, gold is trading near record highs, benefiting from a weakening dollar and increased risk aversion in global markets. Investors are closely monitoring central bank activity and geopolitical developments for further clues about the metal’s trajectory.
