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Gold trades near $3,670 on Friday, snapping a two-day losing streak after the Fed’s interest rate cut. The US Dollar and Treasury yields extend post-Fed rebound as Powell’s tone proved less dovish than expected. Gold remains cushioned as markets anticipate two more Fed rate cuts by year-end. Gold (XAU/USD) regains ground on Friday, snapping a two-day losing streak after a volatile midweek reaction to the Federal Reserve’s (Fed) interest rate decision. At the time of writing, XAU/USD is trading around $3,668 during the American session, up nearly 0.65%. On Wednesday, the US central bank lowered the federal funds rate by 25 basis points (bps) to the 4.00%-4.25% range, a move that was fully priced in. The metal briefly spiked to a fresh all-time high near $3,707 in the immediate aftermath, but the gains quickly faded as Fed Chair Jerome Powell’s press conference struck a less dovish tone, triggering a sharp recovery in the US Dollar (USD) and Treasury yields. Chair Jerome Powell said the Fed does not feel the need to move quickly on rates, describing the latest move as a “risk-management cut” aimed at cushioning the economy amid signs of a slowing labor market. He added that policy is “not on a preset course” and will remain data-dependent, signaling a cautious approach rather than an aggressive easing cycle. Friday’s rebound in XAU/USD comes in spite of a firmer US Dollar and rising Treasury yields, as traders weigh the implications of the Fed’s monetary policy outlook. Markets are already pricing in the possibility of two more cuts by year-end, which in turn cushions downside risks for bullion, but elevated yields and a resilient Greenback keep the near-term outlook capped, limiting room for further gains. Market movers: US Dollar firms with higher yields, Fed projects gradual easing Minneapolis Fed President Neel…

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Filed under: News - @ September 19, 2025 8:28 pm