Slower Growth, Softer Gold: A Mid-2025 Snapshot
- Luciano Duque
- Jun 10, 2025
- 1 min read
Morgan Stanley’s 2025 Midyear Economic Outlook foresees the world economy expanding just 2.9 % in 2025, the weakest pace since the pandemic. Higher U.S. tariffs are the chief drag, likely pushing U.S. inflation to about 3 – 3.5 % by Q3 even as most other regions cool. With demand ebbing, Morgan Stanley expects rate cuts across many major central banks later this year—except the Fed, which it sees on hold until early 2026.
The slower-growth backdrop has yet to revive safe-haven appetite for gold. After an unexpected rise in U.S. job openings, bullion held a decline near $3,360 an ounce on June 4, as investors rotated toward risk assets and a firmer dollar. The move highlights how resilient labour data can temper haven demand even when structural worries—tariffs and deficits—persist.
Takeaway for investors: Morgan Stanley’s “slow-growth, not no-growth” view still supports core fixed income and select equity niches, while gold’s pullbacks may offer long-term entry points if trade frictions and sticky U.S. inflation linger.
Sources:
Bloomberg News. “Gold Holds Decline After US Jobs Data Deters Demand for Havens.” Bloomberg, 4 June 2025, www.bloomberg.com/news/articles/2025-06-04/gold-xauusd-holds-decline-after-us-jobs-data-deters-demand-for-havens.
Morgan Stanley. “2025 Midyear Economic Outlook: A Widespread Deceleration.” Morgan Stanley, 28 May 2025, www.morganstanley.com/insights/articles/economic-outlook-midyear-2025.
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