Gold prices climbed on Tuesday as markets turned their attention to the Federal Reserve’s final policy meeting of the year. Investors eagerly awaited insights into the U.S. central bank’s interest rate outlook for 2025.
Gold Prices Show Positive Movement
Spot gold prices rose by 0.22% (or $5.80) to reach $2,653.85 per ounce at 10:45 AM. This was a slight increase from the previous day’s close of $2,652.75 per ounce. Analysts believe this uptick reflects growing optimism ahead of the Federal Reserve’s upcoming policy decisions.
Market Outlook and Federal Reserve Decisions
Investors are closely monitoring the Federal Open Markets Committee (FOMC) meeting, which concludes on Wednesday. A 25-basis-point rate cut is widely expected, but all eyes are on the 2025 economic forecast, Fed dot chart, and comments from Fed Chair Jerome Powell.
According to Jigar Trivedi, a senior analyst at Reliance Securities, “The yellow metal may experience a technical correction, but that could present an opportunity to take long positions.”
Global Central Banks and Economic Data
The Federal Reserve isn’t the only major central bank making headlines this week. The Bank of Japan, Bank of England, Riksbank, and Norges Bank are all scheduled to announce their monetary policy decisions on December 19. Meanwhile, the European Central Bank is expected to reduce rates further in 2025, provided inflation aligns with its 2% target.
Factors Driving Gold Prices
Gold’s performance often improves in a low-interest-rate environment and during times of economic or geopolitical uncertainty. Recent geopolitical developments, such as the U.S. imposing new sanctions on North Korea and Russia, have added to market volatility.
This week’s U.S. GDP and inflation data releases are also in focus, as they may influence future policy decisions and market trends.
Broader Precious Metals Market
- Spot silver fell by 0.2% to $30.47 per ounce.
- Platinum remained steady at $936.30 per ounce.
- Palladium traded flat at $947.41 per ounce.
Conclusion
The Federal Reserve’s policy decisions and 2025 outlook will play a key role in shaping gold market trends. As traders assess these developments alongside geopolitical and economic indicators, the gold market’s trajectory remains under close watch.
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