US giant Morgan Stanley forecasts Turkish lira to perform best, gold to shrink
File photo shows a 1 Troy-ounce gold bar placed on top of a 20 Turkish lira banknote. (Adobe Stock Photo)
Morgan Stanley predicts that the Turkish lira will be one of the top-performing currencies in the Central and Eastern Europe, Middle East, and Africa (CEEMEA) region this year while forecasting gold prices to fall below $2,700 per ounce.
According to the currency exchange forecast updates released by the U.S-based investment bank on Monday, the analysts, who previously expected the Federal Reserve (Fed) to implement three rate cuts in 2025, now foresee only one rate cut in June.
The report noted an expected moderate decline in the dollar index, which is projected to result in a more stable outlook for emerging market currencies. Morgan Stanley analysts expected this moderate decline to have a positive impact on these currencies.
Turkish lira to perform best
The report highlighted that Asia is likely to continue underperforming within the global emerging markets landscape, while the Turkish lira remains a favored asset.
“According to our forecasts, the Turkish lira will be one of the best-performing currencies in the CEEMEA region,” the analysts stated. Despite potential uncertainties in foreign exchange markets, the lira is expected to maintain its strong performance, minimizing exchange rate risks for investors.
Morgan Stanley’s USD/TRY exchange rate forecasts are as follows:
- Q1 2025: 36.50
- Q2 2025: 38.00
- Q4 2025: 41.00
- Q4 2026: 44.00
Gold to shrink below $2,700
The investment bank also provided notable insights into the gold market, which has seen significant price increases due to tariff uncertainties and strong central bank demand.
According to the report, gold prices are expected to fall to $2,700 per ounce by the fourth quarter of 2025, driven by an anticipated decline in demand and a supply-side response.
Since the beginning of the year, gold prices per ounce have risen 9.3%, surpassing the $2,900 threshold.
