Gold Prices Not as Rosy as Early in the Year, New Projections Worry Investors

Gold prices, which surged sharply at the start of 2026, are now facing new pressures. After being regarded as the strongest safe-haven asset amid global conflicts, this precious metal is beginning to lose momentum in the short term.

Global investment bank Morgan Stanley has just cut its gold price target for the second half of 2026. This move signals that market expectations for the gold rally need to be readjusted, especially after high volatility in recent weeks.

Nevertheless, the outlook for gold is not entirely bleak. Many analysts still see potential for price increases if central banks begin cutting interest rates and inflationary pressures ease.

Morgan Stanley has lowered its gold price target to US$5,200 per ounce, equivalent to Rp88.4 million per ounce, a sharp drop from the previous projection of US$5,700 per ounce or about Rp96.9 million per ounce.

This revision comes after gold prices faced significant pressure over the last six weeks. Before the Middle East conflict intensified at the end of February, gold prices had approached a record high of nearly US$5,500 per ounce or about Rp93.5 million.

However, the situation changed quickly. Gold prices are reported to have fallen around 8 percent since the conflict began and are now trading in the range of US$4,700 to US$4,800 per ounce, or about Rp79.9 million to Rp81.6 million.

Although the target has been lowered, Morgan Stanley is not entirely pessimistic. The bank still sees structural support from strong central bank demand, concerns over currency depreciation, and high geopolitical tensions.

For context, China’s central bank added 5 tonnes of gold to its reserves in March. Additionally, Morgan Stanley economists still forecast two 25 basis point interest rate cuts this year, in September and December.

Morgan Stanley identifies three main factors causing the gold rally to lose steam. First, official demand from central banks is beginning to weaken. Turkey’s central bank sold 52 tonnes of gold between 27 February and 27 March, while India has delayed several bullion import approvals.