Gold prices hovered around the $2,578 level on Wednesday and are up nearly 10 points in the day’s trade. They surged by 0.36% and are attracting buying pressure ahead of the Fed meeting.
Commodity traders focus on precious metals to reap profits, but profits in the US dollar remain sceptical. The DXY index, which tracks the performance of the USD, shows that currency trading is at 100.8. That’s a steep decline from a high of 106.20 in July this year.
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A Small Correction Is On The Cards For Gold, But Prices Could Surge Again in 2025
While traders speculate an interest rate cut between 25 and 50 bps, the move could tremendously affect the commodity markets. Naveen Mathur, Director of Commodities and Currencies at Anand Rathi brokerage, explained that 4 to 8% correction is on the cards for gold prices.
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After the Fed meeting, he forecasted that gold prices could fall to $2,450 this month. However, he stressed that this could be a buying opportunity as the precious metal might breach $2,650 in 2025. “We still anticipate a corrective move in gold prices by 4 – 8 percent to around $2,400 – 2,450 before the end of the year. Which could be a good accumulation level for investors looking to increase their exposure to gold,” said Mathur.
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“Meanwhile, strong investor confidence and underlying demand with the start of a lower interest rate regime could still drive gold prices to unprecedented levels in coming years, where even further 12 – 15 percent returns in gold in 2025 as compared to 2024 cannot be ruled out. We expect spot gold to average around $2,600 – 2,650 in 2025, compared to the year-to-date average of $2,280 per oz in 2024,” the director said.
