Anticipation of the Fed's decision stabilizes gold markets around $4,200 per ounce
Global investors are focusing on the upcoming meeting of the US Federal Reserve, with gold prices stabilizing around $4,200 per ounce on Tuesday, as gold prices are trading below $4,185 per ounce, and this relative calm comes ahead of the monetary decision that is expected to set the contours of US fiscal policy for the rest of the year and beyond.
Federal Reserve Outlook
The prevailing readings in the markets point to an expectation of a 25 basis point cut in the key interest rate.
However, the real focus will be on the updated economic outlook and explanatory statements from Fed Governor Jerome Powell.
Traders are looking for the most subtle hints about the path of monetary policy for 2026, in what will be the most important speech of the month.
Market expectations have seen rapid adjustments, with derivatives estimates now showing an 87% chance of the expected cut materializing.
Expectations for the number of cuts in 2026 have fallen to just two, down from three a week ago.
Pressure and support factors
In anticipation of the Fed's decision, market participants are preparing to assess the US JOLTS jobs data, which will give an additional glimpse into the strength of the labor market and its impact on the central bank's decisions.
On the other side of the world, China's central bank continues to strengthen its gold position, announcing that it increased its reserves for the thirteenth consecutive month, bringing its total holdings to 74.12 million ounces.
This continued move is seen not only as a diversification of reserves, but also as a sign of the institution's great confidence in the precious metal as a long-term safe haven, which is a key supportive factor for prices.
Expectations ahead of the Fed decision
Analysts expect precious metals prices, led by gold, to remain locked in a narrow trading range until the decision is announced and Chairman Powell provides clearer explanations.
Gold markets are in a cautious waiting game, balancing between immediate cut expectations and longer-term vision adjustments, with every word from Powell shaping the investment roadmap for the coming months.
On a technical level, we expect prices to move in a narrow, bullish range until the decision on Wednesday evening.
