Gold will extend its rally as the price may surge more than 20 percent in 2020, according to a recent forecast from Russia’s National Rating Agency (NRA).

The economic uncertainties triggered by the coronavirus pandemic have sparked interest in the traditional safe haven asset. In the first half of the year, the price of the precious metal rose 26 percent, hitting a near decade high.

However, the NRA expects gold demand to cool in the next six months as fears about the economic fallout from the coronavirus outbreak wane, leading to a downside correction. Although gold price growth may slow to 15-17 percent in the second part of the year, the annual average price will still grow by 21 percent, the agency said.

Russian gold producers are projected to be the biggest beneficiaries from the price rally. According to analysts’ estimates, gold miners will enjoy better financial performance and will see their annual revenues growing around 30 percent.

Russia is the third-largest gold producer in the world after China and Australia. Last year, the country produced 368 tons. While gold production rose around five percent in the first quarter, Russian producers saw a 20-percent year-on-year decline in April as the coronavirus pandemic triggered lockdowns across the country.

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Given the impact of the coronavirus pandemic on the industry and the Russian economy, the NRA does not expect gold output to differ much from last year’s figures. The analysts’ forecast is more pessimistic than the one presented by the Union of Gold Producers of Russia. In June, the association said that it expects gold production to increase up to one percent this year.

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