Gold Hits Record After Federal Reserve Warns of Slower US Growth
Gold hit another record high after the Federal Reserve projected slower US growth and higher inflation this year, while keeping interest rates unchanged.
Bullion edged up to trade above $3,055 an ounce — surpassing the previous all-time high posted on Wednesday — after Fed Chair Jerome Powell acknowledged a high degree of uncertainty from President Donald Trump’s policy changes, but said the central bank isn’t in a hurry to adjust borrowing costs.
Powell said his base case is that any tariff-driven bump in inflation will be “transitory,” but later added it will be very challenging to say with confidence how much inflation stems from tariffs versus other factors. He also said recession odds have moved up, though are not high.
Gold has climbed 16% since January in a rally that’s seen it hit a series of all-time highs so far in 2025, extending last year’s strong gains as investors have flocked to the precious metal for safety. Several major banks have also raised their price targets for bullion in recent weeks, with Macquarie Group forecasting it could rise as high as $3,500 an ounce.
Spot gold was up 0.2% to $3,052.97 an ounce as of 8:34 a.m. in Singapore, after gaining 2% over the previous three sessions. The Bloomberg Dollar Spot Index dipped 0.1%. Silver, platinum and palladium all edged higher.
Despite an upgrade to the inflation forecast, the bond market seized on the fact that growth estimates were dialed back — validating some of the concerns that Trump’s trade war and spending cuts will cool the economy. Fed officials continue to pencil in a half percentage point of rate cuts this year.
Source: Bloomberg
