Gold edged higher in early trading as a softer US dollar offered a short-lived tailwind, but the Federal Reserve’s “higher-for-longer” messaging is still capping the upside, according to the CoinDesk source.
In Asian trading hours, gold rose about 0.3% to $2,035 per ounce. The source ties that move to the US Dollar Index (DXY) slipping roughly 0.2% to 103.8. The desk notes the usual inverse link: a weaker dollar can make gold cheaper for non-dollar buyers.
Still, the source frames the dollar weakness as profit-taking after a strong rally rather than a fundamental shift in monetary policy. Meanwhile, higher interest rates raise the opportunity cost of holding gold, a non-yielding asset. The CoinDesk source also points to rising Treasury yields, including the 10-year note at 4.35%, as a reason gold may struggle to sustain gains.
The Fed angle matters most here. The source cites Chair Jerome Powell emphasizing inflation staying above the 2% target, supporting restrictive policy. It also cites the CME FedWatch Tool showing a 70% probability that rates remain above 5% through the third quarter of 2025. That rate path, the source argues, constrains gold’s upside.
The article also flags geopolitical and reserve-buying support. It says ongoing conflicts in Eastern Europe and the Middle East underpin safe-haven demand. It further cites World Gold Council data that central banks purchased 1,037 tonnes of gold in 2024, with 2025 “on pace” for similar levels, which the source says can provide a floor.
On the call side, the source attributes a neutral stance to analysts at Goldman Sachs. It adds that a dovish shift in Fed rhetoric could revive interest, while a stronger-than-expected US jobs report could pressure gold further. It also outlines a technical range, with the 50-day moving average around $2,030 and resistance near $2,060, while the RSI near 48 suggests no clear momentum signal.