Last Updated on 17/09/2026
- Gold price drops to around $4,265 in early Asian trading on Thursday.
- The Fed raised its benchmark interest rate by 25 basis points to a target range of 3.75%–4.00% on Wednesday.
- Trump called for the Fed to cut interest rates to 1% “or less” following the rate decision.
Fundamental Analysis
Gold price (XAU/USD) comes under renewed selling pressure, trading around $4,265 during early Asian hours on Thursday. The precious metal extends its decline after the US Federal Reserve (Fed) raised interest rates and indicated that another hike could be possible later this year.
The Federal Open Market Committee (FOMC) unanimously voted on Wednesday to raise the benchmark federal funds rate by 25 basis points to a target range of 3.75%–4.00%. The move marked the Fed’s first rate increase since July 2023.
During the press conference, Fed Chair Kevin Warsh reiterated concerns about persistent inflation, noting that price increases across several goods and services categories remained above 3% on both six- and 12-month annualized measures. His comments pointed to the possibility of additional rate increases in the months ahead, supporting the US Dollar (USD) and putting further pressure on non-yielding Gold.
Higher interest rates generally weigh on Gold because the precious metal does not generate interest income, making yield-bearing assets comparatively more attractive.
Meanwhile, US President Donald Trump called on the Fed to cut interest rates to 1% “or less” on Wednesday, shortly after the central bank announced its first rate hike since 2023. Continued tensions between the White House and the independent Fed could support safe-haven demand and potentially limit Gold’s downside.
Gold’s Safe-Haven Support Offset by Higher Yields and a Stronger Dollar
Commerzbank analysts note that Gold’s recent pullback toward $4,292 reflects a balance between geopolitical safe-haven demand and unfavorable macroeconomic factors. According to the bank, rising Treasury yields and a stronger US Dollar continue to offset some of the support generated by geopolitical risks, limiting Gold’s ability to benefit fully from risk-off flows.
The bank also points to India’s inflation environment as a factor behind firm precious-metal prices, particularly elevated inflation in Gold and Silver jewelry, while underlying core inflation excluding precious metals remains considerably softer.
Technical Analysis: Gold Remains Below the 100-Day SMA
On the daily chart, XAU/USD remains below the 100-day Moving Average (MA) and the 20-period Simple Moving Average (SMA) of the Bollinger Bands. This keeps the near-term outlook tilted to the downside, although momentum remains moderate. The 14-day Relative Strength Index (RSI) is around 42, indicating continued bearish pressure without signaling extreme selling conditions.
On the upside, the 100-day MA near $4,325 represents the first resistance level. The Bollinger midline around $4,440 provides another barrier, while the upper band near $4,685 marks a more distant resistance zone. A sustained move above these levels would help ease the current bearish pressure.
On the downside, the lower Bollinger Band around $4,200 represents the next significant support area, where buyers could emerge if selling pressure intensifies.
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