“Morgan Stanley Thursday cut its outlook on gold prices for the year ahead, but reiterated its view that macroeconomic conditions remain favorable for further price appreciation in the yellow metal.
The bank cut its average price forecast for gold this year by 4% to $1,773 a troy ounce. It also cut its silver price outlook for 2013 by 4% to $33.44/oz.
“We remain bullish on the gold price outlook in 2013 despite recent selling pressure triggered by market concerns of an earlier-than-previously-anticipated tightening in U.S. monetary policy,” the bank said.
“We expect that very low nominal interest rates, an ongoing commitment to QE3, and a below-par recovery with attendant pressure on the U.S. easing will still combine to encourage investment buying of gold, despite elevated prices,” it added.
Silver should continue to outperform gold on a relative basis this year, despite expected volatility, it added….”
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