January 20, 2025
New Delhi, India
Gold Prices Today
The price of gold (XAU/USD) experienced a modest rebound during Monday’s Asian session, attracting dip-buyers near the $2,689 mark. This recovery halts a brief retracement from a one-month high touched last week. A softer US Dollar (USD), driven by expectations of two Federal Reserve (Fed) rate cuts in 2025 amidst cooling inflation, supported the precious metal’s rise above the $2,700 level.
The easing inflation outlook was bolstered by the US Producer Price Index (PPI) and Consumer Price Index (CPI) figures from December. Additionally, Fed Governor Christopher Waller hinted that inflation could continue easing, enabling faster rate cuts.
Impact of Geopolitical and Trade Developments
Uncertainty surrounding US President-elect Donald Trump’s tariff plans and potential relaxation of sanctions on Russia has fostered a positive risk tone. The Israel-Hamas ceasefire and hopes for reduced tensions in Ukraine have further stabilized market sentiment, offering mixed signals for gold as a safe haven.
However, expectations of inflationary pressures from Trump’s protectionist policies may compel the Fed to maintain a hawkish stance, potentially capping further gains for gold.
Market Outlook
Traders remain cautious ahead of Trump’s inaugural address later today, seeking clarity on his policy directions. The US market will observe Martin Luther King Jr. Day, likely limiting trading activity.
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