Gold Grinds Higher as Fed Rate Cut Hopes and Trump Tariffs Weigh on Dollar
Gold is edging higher Thursday, stabilizing after yesterday’s early drop found support at $3,282.66 before reclaiming the $3,310.48 pivot.
Gains remain capped by the 50-day moving average at $3,323.50, with another resistance level near the short-term pivot at $3,347.97. The market remains locked in a tight three-week range as traders await a clear catalyst from Trump’s tariffs and the Fed’s policy path.
At 12:07 GMT, XAU/USD is trading $3318.16, up $4.46 or +0.13%.
Will the Fed Finally Signal a Cut?
Minutes from the Fed’s June meeting showed most officials see rate cuts likely this year, even as they held rates steady last month.
The 10-year Treasury yield slid to 4.342%, while the 2-year yield dropped to 3.853%, reinforcing expectations that easing is on the table if inflation and hiring weaken.
For gold, lower yields reduce the opportunity cost of holding non-yielding bullion, supporting bids above $3,310 if the Fed’s signals align with market hopes.
Trump Tariffs Threaten Fresh Inflation Risks
President Trump’s escalation of his tariff campaign, with 50% levies on copper imports and goods from Brazil effective August 1, along with additional 20-40% tariffs on other nations, has traders weighing fresh inflation concerns.
Gold Price Forecast
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See all Gold forecastsWhile global equities shrugged off the latest salvos, ongoing uncertainty over tariffs feeds a potential inflation bid for gold, particularly if energy prices rise on supply concerns tied to policy tensions.
Dollar Weakness Lends Gold a Hand
The dollar index eased 0.2%, supported by increasing bets that the Fed will cut rates later this year. IMF data shows the dollar’s share of global reserves dipping to 57.7% as the Swiss franc and euro gained ground, reflecting broader sentiment shifts.
A softer dollar supports gold by making it less expensive for other currency holders, aligning with the pullback needed for a sustained move above key resistance zones.
Gold Prices Forecast: Rangebound, Waiting for a Catalyst
Swing chart traders are watching the range between $3,244.41 and $3,365.92, with a midpoint at $3,305.17 providing a pivot area for near-term positioning. Moving average traders remain focused on the 50-day MA at $3,323.50 for directional confirmation, while pivot traders eye support at $3,310.48 and resistance at $3,347.97.
For now, gold prices forecast a rangebound grind, waiting for clarity from Trump’s tariffs and the Fed’s next move. A confirmed break above $3,347.97 could open a push toward $3,365.92, while a drop below $3,282.66 would warn of deeper profit-taking toward $3,244.41.
More Information in our Economic Calendar.