Gold Prices Rise as Dollar Weakens
Gold prices moved higher on Thursday, supported by a weaker US dollar as investors evaluated the outlook for monetary policy following recent decisions by major central banks.
By 10:07 ET (14:07 GMT), spot gold climbed 1.7% to $4,619.23 per ounce, while gold futures gained 1.5% to $4,632.66 per ounce.
Technical Levels and Market Reaction
According to analyst David Morrison, gold rebounded after briefly approaching the $4,500 level, where buying interest emerged. However, the metal encountered resistance near $4,550.
He noted that earlier dollar strength—driven by concerns over rising inflation linked to the U.S.-Iran conflict—initially limited gains.
Federal Reserve Holds Rates Amid Uncertainty
The Federal Reserve kept interest rates unchanged, as expected. Chair Jerome Powell highlighted the uncertain economic outlook, particularly due to geopolitical tensions in the Middle East.
Powell warned that higher energy prices could push inflation higher in the near term, while the broader economic impact remains unclear. He added that policymakers are prepared to either tighten or ease policy depending on how conditions evolve.
Policy Uncertainty and Leadership Focus
Market attention also centered on Powell’s future role, as he confirmed he will remain a governor despite speculation about leadership changes. Reports suggest he may eventually be replaced by Kevin Warsh, a potential nominee backed by Donald Trump.
Analysts at JPMorgan noted that the latest policy statement offered limited new insights, though internal disagreements among policymakers signaled diverging views on inflation and rate direction.
Inflation Data in Focus
Fresh data from the Bureau of Economic Analysis showed that the core PCE price index, the Fed’s preferred inflation gauge, rose 0.3% month-on-month in March, in line with expectations.
- Headline PCE: up 0.7% month-on-month
- Core PCE (YoY): 3.2%
- Headline PCE (YoY): 3.5%
Both annual readings matched forecasts but accelerated from February levels, reflecting persistent inflation pressures.
Growth Outlook Remains Mixed
The U.S. economy expanded at an annualized rate of 2.0% in Q1 2026, slightly below expectations but stronger than the previous quarter’s 0.5% growth.
Economists noted that growth remains uneven, with the technology sector providing most of the momentum, while broader economic activity appears softer.
Middle East Tensions Add to Market Uncertainty
Geopolitical risks continue to influence markets. Reports indicate that President Trump is set to receive a briefing on potential new military actions against Iran, as negotiations remain stalled.
The ongoing disruption in the Strait of Hormuz has heightened concerns about energy supply, contributing to volatility in oil and commodity markets.
Oil Prices Volatile After Initial Gains
Oil prices initially rose on geopolitical concerns but later reversed, reflecting uncertainty over the conflict’s trajectory and its impact on global supply chains.
