Gold (XAU) Steadies Near Record After Fed Maintains Interest Rates

Gold is at near-all-time highs as the Federal Reserve keeps its benchmark rate unchanged at 4.25%- 4.5%, maintaining its appeal as a safe-haven asset amid economic uncertainty.

Gold (XAU) Maintains Strength as Fed Signals Policy Shift

Gold steadied close to its record price following the Federal Reserve's decision to hold interest rates steady for a second consecutive meeting. The Federal Open Market Committee (FOMC) voted on Wednesday to maintain the benchmark federal funds rate in a range of 4.25%-4.5%, while also announcing plans to further slow the pace of its balance sheet reduction. The precious metal edged slightly upward as both the dollar and Treasury yields declined in response to the rate decision.

Economic Uncertainty Bolsters Gold (XAU) Appeal Despite Trump Policy Pressures

Fed policymakers expressed concerns about the economic outlook, projecting slower growth and higher inflation ahead. This cautious stance comes as President Donald Trump's ambitious and frequently erratic policy agenda has placed increasing pressure on both the economy and the Federal Reserve's ability to maintain stability. These factors have contributed to gold's continued strength as investors seek safe-haven assets.

Gold (XAU) Performance Extends Impressive Yearly Gains Amid Global Economic Concerns

The precious metal has demonstrated remarkable resilience, climbing nearly 16% this year and building upon last year's strong performance. Investors have increasingly flocked to gold for safety amid deteriorating outlooks for both the U.S. and global economies. This sentiment has prompted several major banks to raise their price targets for gold in recent weeks, reflecting growing confidence in the metal's prospects.

Investors Watch Gold (XAU) Reaction to Powell's Commentary on Economic Conditions

Market participants, who widely anticipated the Fed's decision to leave rates unchanged at this meeting, are now focusing on Fed Chair Jerome Powell's press conference in Washington. They're seeking additional insights into how officials are factoring Trump's policies into their economic outlook and how the Federal Reserve might respond should economic conditions worsen further.

The continued strength in gold prices reflects persistent concerns about economic stability and inflation risks. Spot gold rose 0.2% to $3,039.54 an ounce at 2:33 p.m. in New York, holding near its historic highs. Meanwhile, other precious metals including silver, platinum, and palladium experienced declines during the same trading session.

Gold's performance comes against a backdrop of monetary policy uncertainty, as the Fed navigates complex economic conditions influenced by both domestic policy shifts and global economic pressures. The central bank's cautious approach to interest rates has provided a supportive environment for non-yielding assets like gold.

Analysts note that the Fed's acknowledgment of potential headwinds for economic growth validates investors' concerns and helps explain the continued robust demand for gold. As a traditional store of value during periods of economic uncertainty, gold has benefited from the current climate of caution among both institutional and retail investors.

The precious metal's price movements will likely remain sensitive to forthcoming economic data and any shifts in central bank rhetoric, as market participants continue to assess the trajectory of monetary policy and economic growth in the months ahead.