Gold prices retreated after touching a new all-time high, pressured by a stronger U.S. dollar following the Federal Reserve’s latest interest rate decision. The Fed cut rates as expected, but comments from Chair Jerome Powell sounded less dovish than before, which shifted market sentiment.
The initial rally to $3,707.57 per ounce quickly turned into profit-taking, with gold dropping about 1.2% before finding support. The pullback came as investors worried about inflation risks and the Fed’s vulnerability to political pressure. At the same time, traders moved into safer assets, boosting the dollar.
Still, the outlook for gold remains broadly positive. Global debt worries, geopolitical tensions, and signs of a slowing economy could renew demand for the metal. So far in 2025, gold has already gained nearly 40%, supported by central bank purchases and strong ETF inflows, and it continues to outperform stocks and bonds.
Fed Chair Powell’s View
Powell admitted that job growth is slowing and the labour market is no longer “very stable.” He stressed the need to balance the fight against inflation with growing risks to employment. His cautious stance helped lift the dollar but did little to change the long-term case for gold.
Gold Technical Outlook
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Resistance levels: First at $3,658. A breakout here would allow a retest of the record $3,705, followed by a bigger target at $3,813.
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Support levels: Nearest at $3,600. A break below could push prices down to $3,562, with further downside risk toward $3,526.
