Gold Week-Ahead Outlook: Fed Cuts, CPI Risk, and Why $4,299 Matters
Gold holds near $4,299 as the Fed cuts rates by 25 bps. US jobs, CPI, and Fed signals now set the tone for gold prices this week.
Quick overview
- Gold closed at $4,299, maintaining a positive outlook amid US growth slowdown and geopolitical tensions.
- The Federal Reserve's recent rate cut and cautious stance have pressured the dollar, making gold more attractive as a hedge.
- Geopolitical uncertainties, particularly regarding the Russia-Ukraine conflict, continue to support safe-haven demand for gold.
- Upcoming US economic data releases could influence gold's direction, with weaker readings potentially reinforcing its appeal.
Gold closed out Friday at $4,299, finishing the week relatively unchanged in a rising price channel and confirming a positive outlook for gold going forward. It’s a move which seems to be in response to the US growth slowdown , the Federal Reserve dialing back its hawkish stance and ongoing geopolitical worries.
All these factors continue to make gold look pretty attractive as a hedge and a way to even out your portfolio.
Fed Shift Pressures Dollar, Supports Gold
The Federal Reserve is the key driver behind the recent resilience in the gold price. Their decision to cut rates by 0.25 percent and signal only one more cut for 2026 was in line with expectations.
What Jerome Powell did say though, was a bit more nuanced. He mentioned we should be careful about how we approach interest rates and said he’s worried about the state of the job market: he doesn’t want to do anything that might put people out of work.
Investors took that caution as a hint that the Fed might be more willing to cut rates than they initially thought, and that shifted expectation for rates which in turn hit the US dollar , sending it down to a couple of month low and lowering interest rates in real terms – that reduces the cost of holding onto gold which doesn’t pay interest but tends to do well when interest rates are low.
Geopolitics Keep Safe-Haven Demand Intact
On top of monetary policy though, geopolitics are also providing a steady boost to gold. The ongoing talks aimed at ending the Russia Ukraine conflict are going nowhere fast, and we’re just hearing more talk about how not a lot is happening – even as the general mood in markets is leaning towards more risk taking, gold has been able to hold up pretty well and that suggests investors are still worried about the risk of things getting worse globally and that’s a big part of gold’s appeal.
Key US Data: Forecast vs Previous
Now the focus turns to some key US data releases which could shape the direction of gold over the coming week:
- Empire State Manufacturing Index: forecast 9.8 vs prior 18.7
- Non-Farm Employment Change: forecast 50K vs 119K previously
- Unemployment Rate: forecast 4.5% vs 4.4%
- CPI y/y: forecast 3.0%
- Core CPI m/m: forecast 0.2% vs 0.3%
If we get weaker readings on jobs and manufacturing that could reinforce the idea that the economy is slowing and that will probably help out gold. But the real test will be the inflation numbers, especially if they come in softer than expected.
Gold (XAU/USD) Technical Structure Favors the Upside
Looking at gold’s price action, we are still seeing support at the 50 day EMA at $4,227 and the 100 day EMA just shy of $4,190 . The buyers have been holding up pretty well at $4,270 to $4,280 and there is still a bit of resistance up at $4,340 and $4,385.
The momentum indicators are still generally on the side of the bulls, which suggests that any setbacks gold takes are likely to be short-lived.
For now, the outlook for gold heading into the new week looks pretty positive: the macro backdrop is still a bit uncertain and the technical picture is still supportive.
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