Spot Gold scales new all-time high, Fed flags two rate cuts

Spot Gold extended its rally to a fresh record high of $3,057.21 per troy ounce on Thursday, after the Federal Reserve flagged two potential interest rate cuts by the end of 2025, further heightening the appeal of the safe haven metal.

The Fed kept its federal funds rate target range without change at 4.25%-4.50% at its March meeting, in line with market consensus.

FOMC policy makers noted that although uncertainty over the economic outlook had increased, interest rates could be reduced by about 50 basis points by year-end.

The US central bank revised down its 2025 GDP growth forecast to 1.7% from 2.1% in the December projection. And, the 2026 forecast was revised down to 1.8% from 2% previously.

Additionally, annual core PCE inflation forecasts were revised up, as follows:

– for 2025 – to 2.7% from 2.5%;
– for 2026 – to 2.2% from 2.1%.

Uncertainty surrounding US tariffs, potential rate cuts and escalating Middle East tensions have fueled Gold’s rally to a series of record highs this year.

“For now, gold’s appeal as a safe haven and inflation hedge has further strengthened in light of those geopolitical concerns and tariff uncertainty. We remain constructive on the outlook of gold,” OCBC Forex strategist Christopher Wong was quoted as saying by Reuters.

Spot Gold was last little changed on the day to trade at $3,046.17 per troy ounce.