Gold Steadies Near $3,400 as Traders Eye Fed’s PCE Inflation Gauge
Spot gold pulled back just a touch on Friday after tagging a new monthly high of $3,423.18 on Thursday. Buyers hit the brakes early in the session, waiting on July’s U.S. PCE inflation report—the Fed’s go-to inflation metric.
Gold is still up about 3.6% for August and holding above the psychological $3,400 mark for now. If bulls stay in control, the July top at $3,439.04 and the June high at $3,451.53 are the next ceilings to watch. A clean break through those sets the stage for a run at the all-time high of $3,500.20.
At 11:52 GMT, XAU/USD is trading $3410.80, down $6.26 or -0.18%.
Support Levels Lined Up Below as Bulls Guard the Trend
That being said, gold is not without downside risk. Traders are still watching $3,367.37 as a nearby floor, with the pivot at $3,353.58 and the 50-day moving average at $3,348.80 just below. That 50-day is quietly running the show—dip-buyers have defended it well, and sellers haven’t managed a daily close beneath it since August 21.
Dollar Soft, Yields Muted, and Political Risk Creeping In
The broader backdrop is helping gold stay afloat. The U.S. dollar is heading for a 2% monthly drop, while Treasury yields remain soft despite ticking slightly higher Friday. Political noise is also in the mix—President Trump’s attempts to fire Fed Governor Lisa Cook have sparked concerns over the Fed’s independence. That’s not driving big flows just yet, but the potential for credibility risk is now priced into the longer end of the curve.
Rate Cut Odds Climb as Fed Doves Get Louder
On the rate front, traders are locking in bets. There’s now an 85%+ chance of a September rate cut, according to CME FedWatch. Fed Governor Waller said Thursday he wants to start cutting next month—and expects more to follow.
If Friday’s PCE data comes in around expectations (0.2% m/m, 2.6% y/y), it likely keeps that dovish tilt intact. But a hotter print north of 3% would catch markets offside and could send gold back under $3,400 fast.
Gold Price Forecast
Every new Gold analysis as it publishes, today's technical signal and key levels, live price — on one page.
See all Gold forecastsGold Prices Forecast: Bullish Tilt Holds, But Ceiling Still Intact
We’re still seeing buyers step in on dips, and as long as gold holds the 50-day, bulls have the upper hand. But it doesn’t take a lot of imagination to see how quickly sentiment could sour on a hot PCE read. More likely than not, gold continues to consolidate between $3,350 and $3,450 until we get clearer data next week. Time will tell, but for now, the market wants to believe in a dovish Fed.
More Information in our Economic Calendar.
