Among the more notable features of gold’s impressive march higher is the fact it has managed to sustain its upward momentum in the face of historically metals-adverse conditions such as surging interest rates and the flourishing of risk assets. Despite these ostensible challenges, gold has reached new all-time highs more than 70 times since just the beginning of 2024 and appreciated an astonishing 100% since January 2022, strongly outperforming the world’s most prominent equities indexes over the same period.
According to Amy Gower, head of metals and mining commodity strategy at Morgan Stanley, gold’s seemingly unprecedented demonstration of strength is evidence of an equally unprecedented intensification in the uncertainty which has been sitting at the foundation of gold’s jaw-dropping resilience.
“The Role of Gold Is Evolving in 2025”
“Gold has always been the go-to asset in times of uncertainty,” Gower said in a commentary earlier this week. “But in 2025, its role is evolving. Investors are watching gold not just as a hedge against inflation, but as a barometer for everything from central bank policy to geopolitical risk.”
“When gold prices move, it’s often a sign that something big is happening beneath the surface,” Gower added.
Gower’s reference to the “evolution” of gold’s function as both a tactical and strategic asset speaks to the degree to which the nature – including the complexity – of metals-favorable uncertainty has proved to be such a potent catalyst of gold prices over the last several years.
It is, in fact, the length, width and breadth of this uncertainty…comprised of an array of factors that includes an unsustainable U.S. fiscal trajectory, aggressive worlwide de-dollarization and the most dangerous geopolitical environment since World War II… which has generated sweeping levels of interest in the yellow metal from individual investors to central banks.
“Central banks are on track for another year of strong buying, with gold now representing a bigger share of central bank reserves than treasuries for the first time since 1996,” Gower said. “This is a strong vote of confidence in gold’s long-term value. Also, gold-backed exchange-traded funds, or ETFs, saw inflows of $5 billion in August alone, with the year-to-date inflows the highest on record outside of 2020, signaling renewed interest from institutional investors too.”
Gold Poised to Reach $3,800 by Year End, Says Gower
In addition to the foundational support for gold provided by the multidimensional uncertainty that Gower and so many others expect to persist, the strategist also said the likely resumption of rate cuts should further energize gold in the coming months, noting that “gold does tend to outperform after Fed rate cuts.”
So, what’s Morgan Stanley’s end-of-2025 price target for gold?
“From here, we see around 5% further upside to gold by year end, to $3,800 per ounce,” Gower said.
Since Amy Gower’s commentary aired a handful of days ago, gold already finds itself around $3,700, just 2.5% below Morgan Stanley’s $3,800 EOY price target. Whether it actually reaches $3,800 or even sustains its current price level remains to be seen, of course. But a couple of points are worth noting.
All Gas, No Brakes: Analysts See Gold Between $4,000 and $5,000 in 2026
For one thing, Morgan Stanley analysts by no means are alone in their robust expectations for gold to continue rising well into record territory. Numerous, highly credible analysts expect the metals bull to keep running through at least the foreseeable future…including those at Goldman Sachs, whose projections for 2026 range from $4,000 (base case) to as high as $5,000.
Moreover, practically no one in the analyst community is forecasting gold to suffer a meaningful correction anytime soon…a fact that State Street strategist Aakash Doshi says is even more revealing than the optimistic upside price targets many have proposed.
Which brings me here: Doshi’s fundamental point…the thing he believes is “revealed” by gold’s resistance to backsliding…is that the metal remains highly supported by a multitude of uncertainty-representative factors and conditions so significant that it’s all but impossible for a universally revered safe-haven asset like gold to materially decline in value right now.
That’s also the “something big beneath the surface” to which Amy Gower referred; it’s what she means when she says gold’s “role is evolving.”
And it’s why, at the end of the day, gold remains especially well-suited to continue serving as a valuable hedge and diversifier on behalf of so many investors at all levels.
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