Top U.S. Bank Says Gold Rally Still Has More Room to Surge
Gold’s rally is showing little sign of fatigue after pushing decisively beyond the $5,000 mark, with analysts at Morgan Stanley arguing that the precious metal still has meaningful upside ahead.
The bank’s latest outlook comes as gold prices continue to benefit from a combination of political uncertainty, central bank buying, and strong investor demand. Fresh concerns over U.S. fiscal stability, including the growing risk of a government shutdown later this month, have further reinforced gold’s role as a preferred safe-haven asset.
- Gold has moved above $5,000 with safe-haven demand rising.
- Morgan Stanley says the rally is not over yet.
- Central bank buying and tight supply continue to support prices.
Gold surge outpaces earlier expectations
Gold has already moved well beyond levels many analysts had expected only later in the cycle. According to Morgan Stanley, the metal has surpassed its previous projections for the second half of 2026, yet the bank does not see clear signs that the rally has reached exhaustion.
Instead, the move is being framed as part of a broader structural advance rather than a short-lived spike. Persistent geopolitical tensions and elevated macro uncertainty are continuing to support demand, even as prices trade near historic highs.
Central banks and ETFs tighten supply
A key driver behind gold’s strength has been sustained accumulation by central banks, which has reduced available supply in the market. At the same time, inflows into gold-backed exchange-traded funds have absorbed much of the remaining liquidity, following several years in which the market ran persistent deficits.
Morgan Stanley notes that this combination has tightened physical supply conditions, creating an environment where price pullbacks remain shallow and buying interest quickly re-emerges.
Dollar weakness adds further support
The bank also highlights the role of a softer U.S. dollar in amplifying gold’s appeal. As the dollar weakens, gold becomes more attractive to international buyers, reinforcing demand from both institutional and physical markets.
Strong physical buying has been particularly evident across key regions, adding another layer of support to the rally.
Bullish outlook remains intact
Looking ahead, Morgan Stanley projects gold could climb toward $5,700 per ounce in the second half of 2026, implying additional upside from current levels. The bank’s bullish stance is underpinned by a rare alignment of supportive factors: tight supply, robust institutional demand, and heightened risk aversion across global markets.
Beyond gold, analysts also point to strength across the broader precious metals space. Silver, in particular, is showing signs of constrained physical availability in parts of Asia, suggesting that the demand-driven dynamics extend beyond gold alone.
For now, the bank’s assessment suggests that gold’s recent surge is less about speculative excess and more about a market responding to deepening structural and geopolitical risks.
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