Gold (XAUUSD) & Silver Price Forecast: Fed’s Hawkish Pause Weighs on Metals Outlook

Market Overview

Gold (XAU/USD) extended its decline during Friday’s Asian session, hitting a one-week low of $3,340. The move came in response to the U.S. Federal Reserve’s decision to leave interest rates unchanged, while maintaining a firmly hawkish outlook.

The central bank now projects only two rate cuts in 2025, with one each in 2026 and 2027, well below previous market expectations.

This “higher-for-longer” stance dampens demand for non-yielding assets, such as gold. “The Fed remains committed to keeping policy tight until inflation is sustainably at 2%,” the FOMC noted. This shift in tone pushed real yields higher and pressured precious metals across the board.

Silver Tracks Gold Lower, Finds Support Near $35.60

Silver (XAG/USD) mirrored gold’s weakness, dipping to an intraday low of $35.66 before stabilizing near $35.63. Despite the Fed-driven pressure, silver’s downside was limited by broader risk aversion and continued demand for safe-haven assets.

Technical structure remains supported by the 50-day EMA and higher-low formations, while buyers appear to be stepping in at key levels, anticipating a rebound should uncertainty deepen across global markets.

Geopolitical and Trade Risks Underpin Safe-Haven Flows

Despite monetary policy headwinds, gold and silver continue to benefit from global uncertainty. Geopolitical tensions in key regions and trade policy risks—especially the potential for new U.S. tariffs ahead of the July 9 deadline—are fueling cautious positioning across equities and commodities.

Investors remain sensitive to any escalation in global tensions or disruptions in trade flows, which could reignite demand for metals. “We’re in a holding pattern, but safe-haven appetite could return quickly if headlines worsen,” noted a Hong Kong-based metals trader.

Weaker Dollar Offers Some Relief to Metals

The U.S. Dollar Index slipped modestly following the Fed’s policy announcement, offering minor support to gold and silver. A weaker greenback typically benefits dollar-denominated assets, especially when paired with a broad risk-off tone seen in global equities.

With inflation data and central bank remarks ahead, the near-term path for metals hinges on evolving risk sentiment and how markets price in the Fed’s slower easing trajectory. Until then, gold and silver may continue to trade defensively, yet remain firmly anchored by safe-haven demand.

Short-Term Forecast

Gold remains under pressure below $3,358 with bearish momentum building. Silver faces further downside risk if $35.29 breaks, unless buyers reclaim key resistance at $35.85.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading at $3,342, extending its decline within a well-defined descending channel. Price recently broke below both the 200 EMA ($3,357) and horizontal support at $3,358, signaling renewed bearish pressure.

The 50 EMA ($3,377) continues to slope downward, confirming that sellers remain in control. There’s no bullish reversal pattern visible; instead, momentum is building on the downside as the price respects lower highs and lower lows.

If $3,328 fails to hold, the next key level sits at $3,311. Short-term structure remains bearish unless gold reclaims the channel’s upper boundary and closes back above the 200 EMA with strength.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver (XAG/USD) is trading at $35.63 after a sharp breakdown beneath the $35.85 support and ascending trendline structure. The move was accompanied by a strong bearish candle that sliced through the 50 EMA ($36.49), confirming momentum had shifted to the downside.

Price briefly pierced the 200 EMA at $35.62, which now serves as immediate support. The structure of the drop suggests capitulation, with no meaningful bullish wick or rebound yet visible.

If silver fails to reclaim $35.85, the following key levels to watch lie at $35.29 and $34.78. A sustained close below the 200 EMA could expose the market to further downside pressure.