Gold Price Forecast: XAU/USD current rally could be the start of something more sustainable – ANZ

Gold surged to a record high as the prospect of rate cuts from the Fed rose. Economists at ANZ Bank analyze the yellow metal’s outlook.

The Fed maintained its outlook for three rate cuts this year

The Fed maintained its outlook for three rate cuts this year at Wednesday’s FOMC meeting, suggesting it hasn’t been concerned with the recent uptick in inflation. This was a green light for investors, with holdings of Gold-backed ETFs recording strong inflows.

These flows have been absent in this year’s Gold prices rally, with other factors including heightened geopolitical risks and buying from central banks underpinning the gains. However, increased demand from Gold-backed ETFs suggests the current rally could be the start of something more sustainable.