Morgan Stanley Lowers Gold Price Target for 2026, No Longer Immune to Crises?
Gold, once touted as the safest asset amid geopolitical conflicts, has instead shown disappointing performance. Global investment bank Morgan Stanley has even cut its projection for the world gold price for the second half of 2026, marking a significant shift in market sentiment.
Since the war between the United States (US) and Iran broke out on 28 February 2026, gold prices have fallen around 8% and have yet to recover as investors expected. Meanwhile, stock markets have continued to rise, with the S&P 500 and Nasdaq indices hitting new all-time highs.
Morgan Stanley assesses that a number of investors are beginning to realise that gold is not always an effective safe-haven asset for all types of crisis conditions. Particularly when the world is continuously in a state of uncertainty.
“The reasons for holding gold have now shifted, and investors buying it as a geopolitical hedge are getting an expensive lesson on what kinds of shocks gold actually protects against,” wrote Morgan Stanley analysts, quoted from Market Index on Wednesday, 22 April 2026.
Before the Middle East conflict erupted, gold prices were recording a major surge. The price of the yellow metal even touched US$5,500 per ounce, more than doubling since the start of 2025.
The rally is deemed to be losing its strong fundamental basis. Investment demand surged sharply by 83% year-on-year in 2025, making gold prices increasingly vulnerable to pressure.
“As the rally continues into 2026, it becomes increasingly difficult to explain the ongoing price strength,” added Morgan Stanley analysts.
In its latest report, Morgan Stanley has lowered its gold price target to US$5,200, or around Rp89.3 million (estimated exchange rate of Rp17,190 per US dollar) per ounce. Previously, this global investment institution had targeted gold strengthening to US$5,700, or around Rp97.9 million per ounce.
The revision comes after gold failed to show a strong rally despite the escalating Middle East conflict. Morgan Stanley explains that this weakening of gold is caused by the domino effect of the Middle East conflict, which has triggered global energy supply shocks, resulting in a surge in oil prices and rising inflation.