Gold price prediction today: Where is gold rate headed this week as US Fed meeting in focus? Here’s the outlook

Gold price prediction today: Gold prices are expected to react to the US Federal Reserve policy this week. Maneesh Sharma, AVP - Commodities & Currencies, Anand Rathi Shares and Stock Brokers shares his views and recommendations for gold investors:Last week saw a blend of inflation trends & political interference which involved Fed independence risk created a wave of uncertainty, boosting safe haven appeal for gold as it continued to hit record highs.In the US, mixed inflation data, cooling labour markets, and weakening consumer sentiment kept expectations of a Fed rate cut in place. In Europe, political instability in France added to economic pressure, while the ECB held rates steady. China grappled with deflationary pressures & Japan prepared for snap elections. Other asset classes included, global equity markets ending the week higher, while US Treasury yields, & the US dollar weakened, while oil prices edged up. Gold recorded repeated all-time highs edging near to $ 3,700 per oz in the current week. Gold ETF investors continued to be heavy buyers continuing their purchase for third consecutive months with net holdings rising steadily. led by Western funds. (YTD Inflows: 472.7 tonnes inflows. Vs 6.8 tonnes outflows in 2024).In India, Gold ETFs recorded inflows of Rs 2,190 crore in August, the largest since January’s Rs. 3,751 crores. Global central banks now own more gold than US Treasuries for the first time since 1996, indicating a substantial shift in their foreign exchange holdings. Gold has already surpassed the euro as the second most important reserve asset after the US dollar. Adjusting for over four decades of inflation the spot price of gold, also surpassed its inflation adjusted peak of $ 850 set on January 21, 1980 which comes to around $3590 per oz.The current week remains most crucial for gold as the US Fed may announce its monetary policy on September 17, midnight. It is widely expected that the central bank may go ahead to slash its interest rates by 25 bps, as a slight possibility of a 50 bp cut also exists. Overall possibility of 3 rate cuts persists by the end of the year. Having said that, a summary of economic projections which includes projections on interest rate cuts to be released by the US Fed during the meeting remains crucial to be assessed for further direction in precious metal prices. Overall, a likely hawkish cut could bring in profit booking moves in prices. However, chances of any major correction lower remains' limited, as the US labour market shows signs of weakening, where major supports lie at around $ 3620 – 3570 zone (CMP $ 3685). On the higher side, prices could turn volatile in the coming session post release of Fed statement as strong upside barriers could persist at around $ 3,720 – 3,750 per oz in spot. This could translate to a level of Rs. 1,12,000 - 1,12,500 // 10 gm on MCX futures contract on a higher side on a weekly basis.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)