Gold prices remained largely unchanged on Wednesday, June 18, as investors adopted a cautious stance ahead of the US Federal Reserve’s key policy announcement. A mix of geopolitical uncertainty and soft US economic indicators kept bullion prices in a narrow range globally, while domestic markets saw a mild correction.
Gold Holds Ground in Global Markets
In the international market:
- Spot gold held steady at $3,388.04 an ounce (as of 03:41 GMT)
- US gold futures traded around $3,406.50 per ounce
The market’s focus is squarely on the Fed’s interest rate outlook. While a rate pause is widely expected, any dovish hints about future rate cuts in 2025 could provide a strong tailwind for gold.
“Gold prices remain volatile as markets await clearer signals on what action the U.S. may take amid rising tensions between Iran and Israel,” said Aksha Kamboj, Vice President, India Bullion and Jewellers Association.
Domestic Gold Prices Dip on Profit Booking
In India, gold extended losses for the second straight day due to profit booking:
- 22-carat gold: ₹92,500 per 10 grams
- 24-carat gold: ₹1,00,910 per 10 grams
(Source: Goodreturns)
Despite the pullback, analysts say domestic prices are finding support due to a weaker rupee, which offsets some of the international softness.
“Gold has near-term support at ₹98,920–₹98,590 and resistance around ₹99,950–₹1,00,000 per 10 grams,” said Rahul Kalantri, VP Commodities, Mehta Equities.
Fed Policy & US Data: What to Watch
Recent US economic indicators have sparked renewed speculation around monetary easing:
- Retail sales fell more sharply than expected
- Housing and industrial production also showed weakness
These trends bolster the case for rate cuts later in 2025, which traditionally support gold by lowering the opportunity cost of holding the non-yielding asset.
“Tepid US data strengthens the case for rate cuts,” noted analysts at ANZ, adding that Middle East risks are also keeping gold prices supported.
Middle East Tensions Add to Market Jitters
Geopolitical risk remains a key driver of gold sentiment. Iran and Israel exchanged fresh missile attacks on Wednesday, now marking six consecutive days of open conflict. The U.S. is reportedly stepping up its military presence in the region, raising the threat of broader escalation.
This has kept safe-haven demand for gold intact despite a lack of strong momentum in prices.
Gold ETF Demand Shows Positive Signs
The SPDR Gold Trust, the world’s largest gold-backed ETF, saw a 0.43% increase in holdings on Tuesday (June 17), suggesting continued institutional interest.
Meanwhile, Goldman Sachs remains bullish on the long-term outlook for bullion:
- $3,700 per ounce by end-2025
- $4,000 by mid-2026, driven by central bank demand and ETF inflows
Conclusion
With global uncertainty on the rise and expectations of a more dovish Fed policy later this year, gold is likely to remain in focus. While near-term volatility may persist, the broader outlook remains constructive—particularly for long-term investors.
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