Gold price flirts with weekly low amid Fed rate-cut uncertainty


Most recent article: Gold edges lower on Fed comments 

  • Gold price stays weak for the second straight day amid the Fed’s hawkish outlook.
  • A September rate cut by the Fed remains on the table, which caps gains for the USD.
  • Persistent geopolitical tensions contribute to limiting the downside for the XAU/USD.

Gold price (XAU/USD) extends weakness into the second straight day on Wednesday, flirting with the lowest level in over a week. The overnight hawkish comments by influential Federal Reserve (Fed) officials suggested that the US central bank is unlikely to kickstart its rate-cutting cycle anytime soon amid a resilient US economy. This remains supportive of a modest uptick in the US Treasury bond yields, which is seen acting as a tailwind for the US Dollar (USD) and weighing on the non-yielding yellow metal.

Meanwhile, weaker consumer and producer prices for May keep a September Fed rate cut move on the table. This, along with the risk of further escalating geopolitical tensions in the Middle East and the protracted Russia-Ukraine war, lends some support to the safe-haven Gold price and helps limit the downside. Traders might also prefer to wait for the key US macro data – the final Q1 GDP print on Thursday and the Personal Consumption Expenditures (PCE) Price Index on Friday. The latter might influence the Fed's policy decisions and provide a fresh directional impetus to the XAU/USD. 

Daily Digest Market Movers: Gold price bears seem non-committed amid Fed rate cut uncertainty

  • Federal Reserve policymakers continue to argue in favor of keeping rates higher for longer, which pushes the US Treasury bond yields higher and caps the upside for the non-yielding Gold price.
  • Fed Governor Michelle Bowman showed a willingness to raise borrowing costs if inflation progress stalls and said on Tuesday that they are not yet at the point where it is appropriate to cut rates.
  • Separately, Fed Governor Lisa Cook noted that it would be appropriate to cut rates at some point, though a rise in inflation expectations would imply keeping monetary policy restrictive for longer.
  • A survey from the Conference Board showed on Tuesday that the US Consumer Confidence Index ticked lower to 100.4 in June from 101.3 in the previous month amid worries about the economic outlook. 
  • This comes on top of the recent weakness in US Retail Sales and signs of moderating inflationary pressures, which keeps hopes alive for a September Fed rate cut and acts as a headwind for the US Dollar. 
  • Russia’s Foreign Ministry summoned US Ambassador Lynne Tracy earlier this week and blamed the US for a barbaric attack in Crimea, and said that retaliatory measures would “definitely follow”.
  • Concerns about an all-out war between Israel and Lebanon remain alive in the wake of soaring tensions on provocations by Hezbollah, helping limit the downside for the safe-haven precious metal. 
  • Traders also seem reluctant to place aggressive directional bets and now look forward to the release of the Personal Consumption Expenditures (PCE) Price Index on Friday for some meaningful impetus.

Technical Analysis: Gold price holds above ascending trendline support near $2,310 area

From a technical perspective, the recent failure to capitalize on the strength beyond the 50-day Simple Moving Average (SMA) and the subsequent slide favors bearish traders. Moreover, oscillators on the daily chart have again started gaining negative traction, suggesting that the path of least resistance for the Gold price is to the downside. That said, it will still be prudent to wait for a sustained break below a short-term ascending trendline support, currently pegged near the $2,310 area, before positioning for further losses. The XAU/USD might then weaken further below the $2,300 mark and retest the monthly swing low, around the $2,287-2,286 region. Some follow-through selling will reaffirm the negative bias and expose the 100-day SMA support near the $2,250 area. The downward trajectory could extend further towards the $2,225-2,220 region before the commodity eventually drops to the $2,200 round-figure mark.

On the flip side, any meaningful positive move now seems to confront stiff resistance near the 50-day SMA, currently near the $2,339-2,340 region, ahead of Friday's swing high, around the $2,368-2,369 zone. A sustained strength beyond the latter could lift the Gold price towards the $2,387-2,388 intermediate hurdle en route to the $2,400 round-figure mark. Some follow-through buying will negate any near-term negative bias and allow the XAU/USD to aim back to challenge the all-time peak, around the $2,450 area touched in May.

US Dollar PRICE Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Euro.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   0.11% 0.00% 0.08% 0.02% -0.55% 0.03% 0.07%
EUR -0.11%   -0.10% -0.05% -0.11% -0.65% -0.06% -0.05%
GBP -0.01% 0.10%   0.08% 0.00% -0.56% 0.06% 0.07%
JPY -0.08% 0.05% -0.08%   -0.07% -0.65% -0.03% -0.01%
CAD -0.02% 0.11% -0.01% 0.07%   -0.61% 0.02% 0.05%
AUD 0.55% 0.65% 0.56% 0.65% 0.61%   0.59% 0.62%
NZD -0.03% 0.06% -0.06% 0.03% -0.02% -0.59%   0.03%
CHF -0.07% 0.05% -0.07% 0.01% -0.05% -0.62% -0.03%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

AUD/USD: Further gains need to clear 0.6460

AUD/USD: Further gains need to clear 0.6460

 

AUD/USD reversed three consecutive daily pullbacks in quite auspicious start to the week, regaining the 0.6400 barrier and putting its critical 200-day SMA near 0.6460 to the test on the back of the intense and renewed selling bias hurting the US Dollar.

EUR/USD: Minor support comes at 1.1060

EUR/USD: Minor support comes at 1.1060

EUR/USD climbed to the 1.1290 region at one point on Monday, though it later gave back part of those gains as the Greenback attempted to recover from its sharp decline, with investors continuing to digest Moody’s downgrade of the US credit rating on Friday.

Gold looks sidelined around $3,230

Gold looks sidelined around $3,230

Gold appears to have entered a range-bound phase around the $3,230 mark per troy ounce at the start of the week, as investors turned to safe-haven assets following Moody’s downgrade of the US government’s credit rating and renewed trade tensions.

Crypto products post $785 million of inflows as Strategy scoops up 7,390 Bitcoin

Crypto products post $785 million of inflows as Strategy scoops up 7,390 Bitcoin

Crypto products recorded a fifth straight week of inflows last week, adding $785 million and lifting its cumulative inflows in 2025 to $7.5 billion, according to CoinShares' weekly report on Monday.

China April slowdown shows the impact of economic uncertainty

China April slowdown shows the impact of economic uncertainty

Trade war uncertainty is denting Chinese confidence, resulting in slower economic activity in April. Retail sales and fixed-asset investment both underperformed forecasts amid heightened caution. Yet the impact on manufacturing was less than feared.

The Best brokers to trade EUR/USD

The Best brokers to trade EUR/USD

SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.

Forex MAJORS

Cryptocurrencies

Signatures

Best Brokers of 2025