Gold Recovers After Fed Rate Hold and Trump Remarks on Iran

Gold Steadies After Fed Rate Hold and Trump's Iran Remarks

Gold prices edged higher in early Asian trading on Thursday, recovering from a weekly low triggered by political and economic crosscurrents. The XAU/USD pair is trading at $3,375, marking a 0.19% increase.

Trump’s Iran Remarks Temporarily Shake Markets

Gold had earlier slumped to $3,362, its lowest level this week, after former US President Donald Trump made comments suggesting a willingness to engage diplomatically with Iran. During a press conference, Trump stated, "If Iran wants to come to the White House, I may do that." The remark temporarily calmed geopolitical tensions, reducing gold’s safe-haven appeal.

Learn More: Why Geopolitical Risks Move Gold Prices

Fed Holds Rates, Signals Dovish Turn Ahead

As expected, the Federal Reserve held its benchmark rate steady on Wednesday. However, the central bank's updated projections hinted at two rate cuts in 2025, signaling a more dovish policy path amid slower growth and persistent inflation near 3%.

• GDP projections were revised down from March forecasts
• The unemployment rate is expected to tick higher
• Inflation is projected to hover around the 3% mark
• Policymakers see 50 basis points in rate cuts ahead

These shifts support gold’s position as a hedge against economic uncertainty.

See the full Federal Reserve June 2025 Economic Projections

Weak US Economic Data Supports Gold

Recent reports revealed softer jobless claims and a sluggish housing market, reinforcing fears of a cooling US economy. These indicators also helped buoy gold prices, as investors turn to safe-haven assets in times of uncertainty.

Outlook for Gold

Despite recent volatility, gold remains fundamentally supported by:

• Uncertain global outlook
• Central bank dovishness
• Geopolitical risks

Analysts suggest that $3,400 could be the next key resistance level if bullish momentum continues.

For real-time price updates and technical analysis, visit our Gold Market Tracker.