Aspire Market Guides


Peak gold is approaching in the current cycle of rising prices for the metal and might even have arrived as Ukraine peace talks start.

A glimpse of the change from a rampant one-way trade can be seen in the modest correction over the past week which has rubbed $40 an ounce off the price since hitting an all-time high of $2939/oz on the London bullion market.

That record could be beaten as momentum trading and late arrivals at the gold party edge it to within sight of the once unimaginable $3000/oz.

But, for the first time since gold took off after the start of Russia’s invasion of Ukraine the tide is turning as the fundamentals of demand destruction and rising supply eat into the price.

Morgan Stanley, an investment bank, expects gold to slip back to $2700/oz by the end of the year and possibly as low as $2400/oz, where it was 12-months ago.

Central bank buying will remain the major driver in the gold market, running at double the rate before the start of the war in Ukraine, but no longer showing a rising trend.

“Tariff uncertainty could take prices a bit higher, in our view,” the bank said.

“But further demand destruction and supply response from recycling and potential profit taking suggests prices could end 2025 lower than they are today, we forecast $2700/oz by the fourth quarter.”

$2400/oz Possible In Peace Deal

The low-ball price of $2400/oz in Morgan Stanley’s calculations is based on a possible decline in central bank buying “that may arise in the event of a potential Russia/Ukraine peace deal.”

The bank said gold’s rising price since the start of the year was initially fuelled by restocking inventory on the U.S. Comex market and resulting drawdown in other markets.

“This effect may be fading now with the Comex and London price spread narrowing again and U.S. stocks close to levels there they previously plateaued,” Morgan Stanley said in a research report headed “Gold: Unstoppable?”

Perhaps the answer to the question in the headline as to whether gold is unstoppable lies in the next move by central banks which have more buying power than any other players in the gold market.

For gold enthusiasts, Morgan Stanley had a sobering warning in its analysis of a “basket of drivers” including analysis of the 10-year TIPS (inflation protected Treasury bonds), the DXY (U.S. dollar index), central bank reserves, ETF holdings, U.S. consumer price inflation, global risk index and commodity futures net positioning.

After analyzing those factors and their effect on the price of gold Morgan Stanely could only get to a price of $2000/oz because the regression is trained on data over the last five years.

The “newest” driver of gold since 2022, central bank buying, still appears robust, though not necessarily showing a growing trajectory, Morgan Stanley said.

“The latest data published by the World Gold Council last week showed a stronger than expected fourth quarter for global central bank purchases at 333 tons (up 54% year on year) and for 2024 to be the third consecutive year of purchases above 1000 tons, which is about double the average rate seen before the start of the Russia/Ukraine conflict,” the bank said.

Central Banks Might Buy Less Gold

“Our base case assumes a slightly more modest pace of central bank buying in 2025 of 850 tons.

“But we continue to watch for downside risks to this from high prices, or a potential Russia/Ukraine peace deal.”

Just as a war in Europe triggered a gold boom led by central bank buying, so could an outbreak of peace in Europe trigger a gold slide.



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