Gold (XAUUSD) Price Forecast: Pivot Breakout Signals Bullish Momentum on Inflation and Tariffs

Bullish Setup Builds on Trade Tensions and Inflation Risks

Gold continues to attract strong buying interest, with prices breaking above a key pivot at $3,062.20, now turned support. The metal is eyeing a retest of its all-time high at $3,167.84, supported by a broader “buy the dip” sentiment in the market.

Traders remain firmly bullish as long as gold holds above the 50-day moving average at $2,960.43, with any sustained break below this level likely to trigger profit-taking or a short-term sentiment shift.

At 11:38 GMT, XAUUSD is trading $3123.39, up $40.44 or +1.31%.

Tariff Escalations Fuel Inflation Expectations

Recent tariff escalations are reigniting inflation fears, reversing expectations of cooling price pressures. The latest CPI data was anticipated to show a decline to 2.6% from 2.8%, but aggressive trade actions have altered that outlook.

President Trump’s move to raise tariffs on Chinese imports from 104% to 125%, coupled with new duties on steel, aluminum, and autos effective April 4, is adding direct cost pressures. China has responded with retaliatory tariffs of 84% on U.S. goods, and additional levies from the EU and other partners further stoke inflation risks.

Economists now warn that inflation could surge toward 4–5% if these measures are fully enacted, with rising costs already visible in categories like apparel, electronics, and vehicles.

Fed Cornered by Stagflation Concerns

The Federal Reserve is caught between conflicting mandates—managing inflation while supporting growth. Previous expectations for rate cuts have been dialed back, with futures markets pricing in 84 basis points of easing by year-end.

However, confidence in a May cut has dropped to just 33%. Fed Chair Powell has emphasized caution, and the latest Fed minutes acknowledge “difficult trade-offs” as inflation and slowing growth collide. This uncertain policy backdrop reinforces gold’s appeal as a hedge.

Technical and Fundamental Setup Supports Higher Gold

Gold has already gained more than 18% year-to-date, bolstered by geopolitical tensions and expectations of rising inflation. Key technical levels continue to support the rally.

The pivot at $3,062.20 and the 50-day moving average at $2,960.43 act as strong base levels, while analysts, including WisdomTree’s Nitesh Shah, see potential for gold to target $3,600 or even $4,000 in a high-uncertainty environment.

Market Forecast: Bullish Bias Intact

Gold remains in a strong position, with both technical structure and macro fundamentals favoring higher prices. The inflationary impulse from tariffs, limited Fed flexibility, and persistent geopolitical risk support a bullish outlook.

As long as U.S.-China trade tensions escalate and inflation expectations rise, gold prices are likely to continue their advance, with upside targets beyond the current all-time high increasingly in play.

More Information in our Economic Calendar.