Analysts at Morgan Stanley raises their gold price forecast for the second half of this year and the year after, in the face of the dovish Fed rate expectations, broad dollar weakness, global economic slowdown and falling US rates.
Key Quotes:
“Real yields close to zero would reduce demand for yielding USD assets.
Could increase the demand for gold.
The negative territory could generate considerable further upside for gold’s price.
Gold price forecast to average USD 1,435 in H2 of this year and USD1,338 in 2020.
Strong price through H1 2020, then stabilizing, lower as rates are kept on hold, economic activity recovers.
Risks to view are skewed to the upside.
Fed is seen cutting rates by a 50bp in July.”
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