Rate cut expectations boost gold’s appeal: Many investors expect the Fed to cut interest rates, perhaps soon. Lower interest rates tend to weaken the U.S. dollar & reduce yields on bonds, which makes non-yielding assets like gold more attractive compared to cash or bonds.
Weakening dollar helps: If rate cuts lead to a weaker dollar, gold (priced in $) becomes cheaper for foreign buyers, often increasing demand.
Safe haven demand: In a scenario where the FED signals caution (slower growth, economic softness), investors often flock to gold as a safe haven. This “hedging demand” can push up gold prices.
Market sentiment & technicals favour a rally: For now, many analysts & commodity trackers believe that gold remains in a “positive technical setup”meaning that if the FED leans dovish, gold could see fresh highs.
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