Gold surged to yet another record high of $3,690 on Tuesday, buoyed by expectations of rate cuts.
Markets are banking on at least a 25-basis-point rate cut in Wednesday’s FOMC meeting, which has sent the U.S. Dollar Index to its lowest level in over seven weeks, at 97.12, according to Vijay Valecha, Chief Investment Officer, Century Financial.
There is speculation about the prospect of a higher reduction, although this remains uncertain. Market participants will parse Powell’s FOMC remarks for the Fed’s quarterly update of economic and rate forecasts, known as the dot plot, which could set the tone for the central bank’s trajectory this year.
Recent economic data indicate softer conditions in the labour market, thereby contributing to haven demand. Moreover, concerns have arisen about the Fed’s independence following Trump's attempt to oust Governor Lisa Cook.
Additionally, Trump’s economic adviser, Stephen Miran, is set to join the Federal Reserve board and could potentially push for a more dovish tilt given Trump’s repeated calls to lower interest rates.
Gold has rallied 40% year-to-date and 5% so far this month, effectively outpacing its inflation-adjusted peak achieved in 1980.
It has created 30 nominal record highs in 2025, propelled by investors seeking a hedge against the possibility of rising prices and weakening currencies amidst Trump’s economic policies. Gold is up 0.35% at $3,692, with immediate 9-SMA support at $3,666 on the 4-hour chart.
Sustained moves above $3,700 could pave the way for another leg of bullish momentum.
Gold prices in Oman are as follows
24 Carat – RO46.00 per gram
22 Carat – RO43.45 per gram
18 Carat – RO34.00 per gram
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