U.S. Federal Reserve Rate Decrease Impact on Today's Gold Market Prices
In the world of investments, gold continues to be a popular choice for those seeking a hedge against inflation and global uncertainties, according to Sugandha Sachdeva, the Founder of SS WealthStreet.
As we look ahead, experts advise keeping a close eye on upcoming US economic data such as the PCE Price Index, GDP updates, and Fed statements for directional cues. These indicators could provide valuable insights into the direction of gold prices.
Despite a recent dip, domestic gold has managed to record gains for the fifth consecutive week. The price drop was partly due to traders booking profits after gold's record highs. On September 20, 2025, gold prices on MCX dipped, but experts advise buying on dips in gold prices.
The US dollar strengthened following Fed Chair Jerome Powell's comments about data-dependent, gradual policy easing. This strengthening of the dollar general led to a dip in gold prices. However, the long-term trend for gold remains bullish, supported by inflationary pressures, central bank demand, and expectations of additional US rate cuts later this year.
Investors expect MCX gold prices to potentially reach Rs. 1,12,000 per 10 gm. Internationally, COMEX gold touched an all-time high of $3,707.65 per troy ounce last week. The global floors for gold prices are at $3,620 and $3,540 per ounce. COMEX gold could hit $3,750 per troy ounce.
Short-term volatility may continue in gold prices. At press time, gold prices on ET Markets show a dip of 0.70%. The dip occurred after the announcement of the US Federal Reserve's 25 basis points rate cut. Despite this dip, the US dollar rebounded following the rate cut announcement.
The long-term trend for gold prices remains bullish. October 2025 gold futures closed at Rs. 1,09,900. With continued global uncertainties and inflationary pressures, gold is expected to remain an attractive investment option for many.
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