Gold prices rose to $2,778 per ounce as the US dollar weakened, with traders closely watching upcoming US GDP data for fresh signals about the economy.
The advance followed remarks from Federal Reserve Chair Jerome Powell suggesting the central bank may pause rate cuts, prompting markets to pare back expectations to roughly 50 basis points of easing this year.
The move in gold reflects wider market uncertainty, in part driven by the potential impact of proposed policy changes — including tariffs and tax measures — that could influence inflation and growth projections.
Market participants are awaiting fourth-quarter GDP figures for clearer guidance on the US growth trajectory. In London trading, other precious metals such as silver, platinum and palladium also posted gains as investors adjusted positions amid the shifting outlook.
Analysts note that a softer dollar typically supports bullion by making it more affordable for overseas buyers, while any signs of slowing US growth or persistent inflation could sustain demand for safe-haven assets. Conversely, stronger-than-expected GDP data might temper bullion’s advance if it raises the likelihood of tighter monetary policy.
Traders and portfolio managers will monitor the GDP release alongside upcoming inflation readings and central bank commentary to reassess interest-rate expectations and their implications for precious metals. In the near term, gold’s direction will likely hinge on how economic data influence the balance between recession risk and persistent inflationary pressure.
For investors, the current environment underscores the importance of watching macroeconomic indicators and policy signals, as shifts in expectations can quickly affect both spot and futures markets across the metals complex.