Gold Price Forecast: Morgan Stanley Sees $4,000 Floor After Selloff

Morgan Stanley metals strategist Amy Gower told CNBC’s Squawk Box Europe that three forces could keep gold supported: persistent physical demand, the possibility of lower long-term bond yields and a decline in oil prices that would ease inflation pressure.

Her view comes after gold’s recent drop below $4,200, when rising crude prices and renewed Fed tightening expectations pushed bullion to its weakest level since early August.

Morgan Stanley Sees Strong Demand Around $4,000

Physical buying is the first pillar of Morgan Stanley’s bullish case.

Central banks bought a net 23 metric tons of gold in July, while China alone added around 20 tons. Broader Chinese gold imports exceeded 1,000 tons during the first eight months of 2026, putting demand on pace for its strongest year since at least 2017.

That demand helps explain why Gower views $4,000 as a meaningful floor rather than simply another psychological level.

Morgan Stanley’s broader research has also remained bullish on gold, previously lifting its 2026 forecast to $4,400 as central-bank purchases, ETF buying and macro uncertainty supported demand.

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The strongest obstacle is still the bond market.

The U.S. 10-year Treasury yield recently surged above 5.3%, making interest-bearing government debt more competitive with gold, which provides no yield. That relationship has already made Treasury yields one of gold’s biggest headwinds.

Gower’s second bullish scenario therefore depends on long-term yields eventually retreating.

Oil matters for the same reason. Lower crude prices could reduce inflation expectations, ease pressure on the Federal Reserve to tighten further and ultimately pull yields lower.