Fed's First Cut Since 2024 Likely To Push Gold To New Record Highs — Experts Flag Key Levels

Gold is poised for further gains as traders brace for the Federal Reserve’s first interest rate cut in nine months, with analysts forecasting new record highs amid easing monetary policy, robust central bank demand and lingering geopolitical uncertainty.

Gold, the safe-haven asset, has climbed to $3,694 per ounce internationally and reached a record Rs 1,10,500 on MCX, with eyes on the $3,700 mark.

"Gold always soars whenever the Fed starts cutting rates, though in the short term, there could be some profit booking based on ‘buy the rumour, sell the news’ trading, FOMC’s dot plot, voting pattern and language,” said Praveen Singh, head of commodities and currencies at Mirae Asset ShareKhan.

He added that markets are pricing in two to three cuts this year and as many as five to six cuts over the next 12 months.

The upcoming decision also carries political undertones. Fed Chair Jerome Powell shifted his focus from inflation to a weakening labour market in his Jackson Hole speech last month. With Stephen Miran, Chair of the Council of Economic Advisers, now confirmed as a Fed governor, and alongside dovish voices like Michelle Bowman, the possibility of a more accommodative stance has risen.

Analysts suggest that a surprise 50-basis-point cut, while less likely, could send gold sharply higher.

"Participants continue to hold long positions, with the key drivers being the anticipated dovish Fed stance and ongoing trade deal developments between the US, India, and China. Gold remains in a positive range of Rs 1,09,000–1,12,000 until the Fed’s policy decision," Jateen Trivedi, research analyst–commodity and currency at LKP Securities, said.

Anuj Gupta, a market and commodities expert, said: "For this week, we are expecting that gold and silver may trade with a positive bias on the expectation of cutting interest rates and weakness in the dollar."

He also flagged geopolitical risks and trade tensions as key drivers of safe-haven demand.

Brokerages remain broadly bullish, though targets vary. Morgan Stanley pegs gold at $3,800, while Kedia Advisory sees it consolidating closer to $3,380.

With the Fed expected to cut rates for the first time since 2024 and markets already pricing in a dovish trajectory, most analysts agree the bias for gold remains upward. The key question is not whether the rally continues, but how high the metal can climb as the Fed reopens its easing cycle.