Gold prices stayed steady near $4,000 per ounce on Friday as traders assessed the impact of the U.S.–China trade truce and the Federal Reserve’s latest policy signals. Spot gold traded around $4,020.48, while gold futures (GCUSD) were slightly lower at $4,014.7, holding above the key psychological level.
After touching a record high of $4,380 on October 20, gold has corrected by nearly 8% due to easing geopolitical tensions and reduced expectations of aggressive Fed rate cuts.
Fed Policy and Dollar Movement
Federal Reserve Chair Jerome Powell urged markets to “remain data-driven” and not expect another rate cut in December. His comments pushed the Bloomberg Dollar Spot Index up 0.1%, strengthening the dollar and weighing on gold’s appeal to non-dollar buyers.
Meanwhile, U.S. 10-year Treasury yields slipped below 4.2%, helping gold maintain its safe-haven demand amid market uncertainty.
Central Banks Continue Buying Gold
Despite short-term corrections, gold remains up nearly 47% year-on-year in 2025, supported by central bank accumulation. The World Gold Council reported that central banks purchased 220 tons of gold in Q3, a 28% increase from Q2, led by Kazakhstan and Brazil.
ETF investors, however, turned cautious — gold-backed ETFs saw six consecutive days of outflows, the longest streak since April, signaling short-term profit booking.
U.S.–China Trade Truce Brings Temporary Relief
Markets welcomed a one-year U.S.–China truce focused on rare earths and critical minerals, with Washington cutting fentanyl tariffs to 10% and Beijing resuming soybean imports. However, analysts warn this calm may be temporary.
“Uncertainty is creeping back into markets,” said Nick Twidale of AT Global Markets. “That could bring dip buyers back into gold before year-end.”
Short-Term Outlook: Correction Before Recovery
Westpac Bank’s Robert Rennie expects gold could dip toward $3,750 before stabilizing, citing ETF outflows and hawkish Fed policy. Still, most analysts view dips below $4,000 as buying opportunities, given ongoing central-bank buying, global slowdown fears, and inflation risks.
Gold Price Forecast 2026–2028: Bullish but Volatile
Analysts remain divided on the gold outlook for 2026:
HSBC forecasts gold to average $4,600, peaking near $5,000/oz by early 2026.
Goldman Sachs raised its target to $4,900, while Bank of America and Société Générale also see gold testing $5,000/oz.
J.P. Morgan remains conservative, projecting $4,000/oz by mid-2026.
LongForecast predicts gold could surge to $7,000–$7,400/oz by 2028 if inflation and geopolitical uncertainty persist.
The bearish case sees gold between $3,500–$4,500/oz, assuming global growth stabilizes and equity markets regain investor confidence.
Bottom Line
Gold’s resilience near the $4,000 mark signals continued investor confidence in the metal as a hedge against inflation and uncertainty. Whether gold breaks above $4,200 or corrects toward $3,750 will largely depend on the Federal Reserve’s 2026 rate path, central bank demand, and geopolitical stability.
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