Gold (XAU) Silver (XAG) Daily Forecast: Fed Speculation and Trade Uncertainty Impact Prices

Stronger US Dollar Weighs on Precious Metals

The US dollar, which faced its worst week since November 2023, gained 0.25% on Monday as investors responded to renewed trade concerns. President Donald Trump’s recent decision to impose 25% tariffs on Colombian imports, following the country’s initial refusal to accept deported migrants, has sparked uncertainty.

Market participants fear further tariff hikes, potentially up to 50%, if compliance issues persist.

A stronger dollar tends to pressure gold and silver prices, making them more expensive for holders of other currencies. “The current movement suggests downside risks for gold remain limited, but the dollar’s resilience poses significant headwinds,” said an analyst at IG Markets.

Fed Rate Cut Bets and Bond Yields in Focus

Despite downward pressure from the dollar, gold remains supported by expectations of Federal Reserve rate cuts in 2025. Lower interest rates generally enhance the appeal of non-yielding assets like gold.

The US Treasury bond yields have fallen in response to speculation of two potential rate cuts this year, with traders closely watching upcoming economic indicators such as the Durable Goods Orders and Consumer Confidence Index.

However, market sentiment remains mixed. Analysts from JPMorgan note that “gold’s outlook remains uncertain as trade policy concerns counterbalance optimism over potential Fed easing.”

Silver Faces Challenges Amid Market Uncertainty

Silver prices have also struggled to gain traction, mirroring gold’s movement. The metal is facing resistance at $30.50, with key support at $30.00. Analysts highlight that silver’s industrial demand outlook remains shaky amid ongoing global economic uncertainties and a stronger dollar.

In the near term, market participants will be closely monitoring developments around trade policies and the Fed’s stance, both of which are expected to influence gold and silver prices significantly.