The Fed's expectations for maintaining stability in July have increased, and the price of gold has fallen below $3,300, approaching a two-week low. The market is focusing on the guidance of the FOMC minutes.
2025-07-09 13:29:46
Gold prices continued to fall, limited by the Fed's stability and the strong dollar
Gold (XAU/USD) was under downward pressure during the Asian trading session on Wednesday, falling below the $3,300 mark and hitting a one-and-a-half-week low. The market has widely accepted the Fed's expectation of keeping interest rates unchanged in July, mainly because Trump announced that he would increase import tariffs on goods from many countries from August 1, triggering market concerns about rising inflation.
This expectation pushed up the 10-year U.S. Treasury yield, supporting the dollar to a two-week high, thereby putting downward pressure on interest-free asset gold.
Strong non-farm data pushes rate cut expectations back
The strong performance of the US non-farm payrolls data for June released last week effectively eased the market's concerns about economic slowdown. In conjunction with the imported inflation that may be caused by high tariffs, the market has basically ruled out the possibility of a rate cut in July, and the expectation of a rate cut this year has been postponed to October, with a cumulative rate cut of 50 basis points.
"Strong employment data and expectations of tax increases have increased the Fed's rationale for maintaining a high interest rate stance." - Market strategist
Trade uncertainty still exists, and the safe-haven attribute provides some support for gold prices
Although gold prices are under short-term pressure, Trump's recent changing tariff stance still makes the global market nervous. His threat to impose a tariff of up to 200% on imported medicines and a 50% tariff on copper products has caused market concerns about a global economic slowdown. The overall risk appetite of the stock market has weakened, so some safe-haven buying has continued to flow into the gold market, limiting the further decline of gold prices.
Investors focus on FOMC minutes and speeches by Fed officials
This week, several Fed officials will give speeches, and the market will also welcome the release of the FOMC meeting minutes. Investors expect to get more clues about the Fed's policy path, especially the assessment of inflation prospects and global risks, which will become a potential turning point for gold prices.
From a technical perspective, the rebound of gold prices in the previous trading day was blocked by the 100-period moving average of the 4-hour chart (near US$3,340), and then fell below the key support level of US$3,300, confirming the start of a short-term downward trend.
The daily chart oscillators (RSI and MACD) turned negative, indicating that the price has further room to fall. If it continues to fall, the short-term target is the $3,250 horizontal support area.
In terms of rebound, the initial resistance level is at $3,310. If it breaks through this level, the upward movement may face the joint suppression of $3,326 and the 100-period moving average (about $3,340). If the bullish momentum increases and breaks through the $3,360 supply zone, it may trigger short-covering and the gold price is expected to return to the $3,400 mark.
"The technical pattern of gold prices has turned bearish. If it cannot return above $3,300 in the short term, it will continue to test the June low." - Technical analyst
Editor's opinion:
Gold is currently on the edge of a policy and risk game. On the one hand, the Fed's "maintaining high interest rates" stance, strong employment and high inflation expectations put pressure on gold prices; on the other hand, escalating trade conflicts and uncertainty in the global economic outlook provide a safe-haven bottom support for gold.
If the FOMC minutes release a stronger signal of "patience", it may intensify the downward pressure on gold prices. Pay attention to whether the $3,250 support area is stable, and closely follow the remarks of Fed officials this week and CPI data to find opportunities for directional breakthroughs.
Gold (XAU/USD) was under downward pressure during the Asian trading session on Wednesday, falling below the $3,300 mark and hitting a one-and-a-half-week low. The market has widely accepted the Fed's expectation of keeping interest rates unchanged in July, mainly because Trump announced that he would increase import tariffs on goods from many countries from August 1, triggering market concerns about rising inflation.
This expectation pushed up the 10-year U.S. Treasury yield, supporting the dollar to a two-week high, thereby putting downward pressure on interest-free asset gold.
Strong non-farm data pushes rate cut expectations back
The strong performance of the US non-farm payrolls data for June released last week effectively eased the market's concerns about economic slowdown. In conjunction with the imported inflation that may be caused by high tariffs, the market has basically ruled out the possibility of a rate cut in July, and the expectation of a rate cut this year has been postponed to October, with a cumulative rate cut of 50 basis points.
"Strong employment data and expectations of tax increases have increased the Fed's rationale for maintaining a high interest rate stance." - Market strategist
Trade uncertainty still exists, and the safe-haven attribute provides some support for gold prices
Although gold prices are under short-term pressure, Trump's recent changing tariff stance still makes the global market nervous. His threat to impose a tariff of up to 200% on imported medicines and a 50% tariff on copper products has caused market concerns about a global economic slowdown. The overall risk appetite of the stock market has weakened, so some safe-haven buying has continued to flow into the gold market, limiting the further decline of gold prices.
Investors focus on FOMC minutes and speeches by Fed officials
This week, several Fed officials will give speeches, and the market will also welcome the release of the FOMC meeting minutes. Investors expect to get more clues about the Fed's policy path, especially the assessment of inflation prospects and global risks, which will become a potential turning point for gold prices.
From a technical perspective, the rebound of gold prices in the previous trading day was blocked by the 100-period moving average of the 4-hour chart (near US$3,340), and then fell below the key support level of US$3,300, confirming the start of a short-term downward trend.
The daily chart oscillators (RSI and MACD) turned negative, indicating that the price has further room to fall. If it continues to fall, the short-term target is the $3,250 horizontal support area.
In terms of rebound, the initial resistance level is at $3,310. If it breaks through this level, the upward movement may face the joint suppression of $3,326 and the 100-period moving average (about $3,340). If the bullish momentum increases and breaks through the $3,360 supply zone, it may trigger short-covering and the gold price is expected to return to the $3,400 mark.
"The technical pattern of gold prices has turned bearish. If it cannot return above $3,300 in the short term, it will continue to test the June low." - Technical analyst
Editor's opinion:
Gold is currently on the edge of a policy and risk game. On the one hand, the Fed's "maintaining high interest rates" stance, strong employment and high inflation expectations put pressure on gold prices; on the other hand, escalating trade conflicts and uncertainty in the global economic outlook provide a safe-haven bottom support for gold.
If the FOMC minutes release a stronger signal of "patience", it may intensify the downward pressure on gold prices. Pay attention to whether the $3,250 support area is stable, and closely follow the remarks of Fed officials this week and CPI data to find opportunities for directional breakthroughs.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
