Gold prices jumped in European trading on Thursday, hitting a two-week high and resuming gains that had temporarily paused yesterday. The metal is now approaching the critical $3,400 per ounce mark, supported by a weakening US dollar in the foreign exchange market.
Less aggressive remarks from some Federal Reserve officials have bolstered expectations of a US interest rate cut in September, with markets awaiting further signals about the Fed’s policy trajectory for the remainder of the year.
Price Overview
• Gold prices today: Gold rose by 0.85% to $3,397.57 per ounce — the highest level since July 23 — from an opening of $3,369.26. The session low was recorded at $3,365.44.
• On Wednesday, gold settled down 0.35%, marking its first loss in five sessions due to profit-taking and corrective moves.
US Dollar
The dollar index fell 0.25% on Thursday, deepening its losses for a second consecutive session and recording a two-week low at 97.95 points, reflecting continued weakness in the US currency against a basket of major peers.
This decline comes amid growing concerns over leadership stability at the Federal Reserve, as preparations are underway to fill a vacant seat on the Board of Governors and announce candidates for the Fed chairmanship.
On Wednesday, President Trump imposed an additional 25% tariff on Indian imports, citing New Delhi’s continued purchases of Russian oil. The move escalated the trade rift between the two countries, with negotiations now at a standstill.
US Interest Rates
• Minneapolis Fed President Neel Kashkari said Wednesday that the Fed may need to cut interest rates soon in response to slowing US economic growth.
• San Francisco Fed President Mary Daly stated Monday that, with mounting evidence of labor market weakness and no signs of persistent inflation from tariffs, “the time has come” to cut interest rates.
• Following these remarks, CME Group’s FedWatch Tool showed the probability of a 25-basis-point rate cut in the September meeting rising from 88% to 94%, while expectations for no change fell from 12% to 6%.
• For the October meeting, the probability of a 25-basis-point cut rose from 95% to 98%, and the odds of maintaining rates dropped from 5% to 2%.
• Investors are watching closely for additional Fed commentary today, as well as weekly US jobless claims data, to reassess rate expectations.
Gold Outlook
• Tim Waterer, Chief Market Analyst at KCM Trade, said: “Trump is issuing fresh tariff threats, keeping gold in the spotlight as a safe haven for investors.”
• He added: “Gold is approaching the psychological $3,400 mark, with risk assets remaining somewhat unsteady due to President Trump’s ongoing tariff rhetoric.”
SPDR Fund
Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell by approximately 3.15 metric tons on Wednesday to 952.79 metric tons — the lowest level since July 21.
