Gold price forecast continues its upward momentum despite a strong US Dollar and rising Treasury bond yields. At the time of writing, XAU/USD is trading at $2,933, reflecting a 0.63% gain. This surge follows a softer-than-expected US Consumer Price Index (CPI) report, fueling market speculation about future Federal Reserve (Fed) rate cuts.
Key Highlights for Gold Price:
- Gold price gains 0.63%, trading at $2,933 amid a softer US CPI report.
- US Treasury yields rise, yet Gold remains resilient.
- Federal Reserve’s potential rate cuts in 2025 support the bullish outlook for Gold.
- Central banks, including China and Poland, continue to increase their Gold reserves.
Market Context: US CPI and Federal Reserve Rate Cuts
The US Bureau of Labor Statistics (BLS) reported that US inflation edged lower in February. However, investor skepticism remains as new tariffs on imports could reignite inflationary pressures. Market expectations have now shifted, with increased speculation that the Fed may implement three rate cuts in 2025. Despite this, Fed Chair Jerome Powell has cautioned against relying solely on a single month’s data when shaping monetary policy.
Meanwhile, US Treasury yields rose as concerns over a global trade war persisted. The 10-year Treasury bond yield climbed by three basis points to 4.314%, while the US Dollar Index (DXY) advanced 0.14% to 103.55. Nevertheless, Gold prices remained strong despite these headwinds.
Technical Insights: Gold Price Forecast
Gold price forecast has successfully breached the upper boundary of its $2,880 – $2,930 trading range, reaching a two-week peak of $2,940. If bullish momentum continues, the next key resistance level to watch is $2,950, followed by the all-time high of $2,954. A break above this level could pave the way for a rally towards the psychological $3,000 mark.
Conversely, if XAU/USD dips below $2,900, the next immediate support lies at $2,850, followed by the February 28 low of $2,832. A further decline could see Gold testing the $2,800 level.
Expert Insights: Central Banks and Gold Demand
The World Gold Council (WGC) reported that central banks remain net buyers of Gold. The People’s Bank of China (PBoC) and the National Bank of Poland (NBP) increased their Gold holdings by 10 and 29 tonnes, respectively, during the first two months of 2025. This continued demand from central banks underlines Gold’s safe-haven appeal amid economic uncertainty.
Conclusion: Outlook for Gold Prices
With inflation showing signs of easing and expectations for Fed rate cuts rising, Gold remains well-positioned for further gains. Investors will closely monitor upcoming economic data releases, including the US Producer Price Index (PPI) and Initial Jobless Claims. Additionally, the University of Michigan’s Consumer Sentiment report could provide further insights into market sentiment.
For more insights, visit Daily Gold Signal. Stay updated with daily market trends at Daily Gold Update.
