Gold extended its rally to a fifth consecutive session on Wednesday, lifted by a rare alignment of falling oil prices, a softening dollar, and the strongest central-bank buying intentions on record. All eyes now turn to Kevin Warsh’s debut press conference as Fed chairman later tonight, where the updated dot plot could either reinforce or undermine the precious metal’s recent recovery.
The catalyst for the latest leg higher came from the energy complex. A preliminary US-Iran accord hammered out in Switzerland has raised the prospect of reopening the Strait of Hormuz as early as Friday, sending Brent crude briefly below $80 a barrel. Cheaper oil lightens inflation fears, and the dollar slipped to near 10-day lows in response, removing a major headwind for gold.
The immediate focus, however, is the Federal Reserve’s rate decision at 20:00 CET. Futures markets assign a 97% probability to no change, leaving the federal funds rate at 3.50%–3.75%, where it has sat since January. The last rate cut occurred in December 2025. The real fireworks are expected from Warsh’s maiden press conference and the accompanying dot plot. Bank of America warns that at least three of the twelve voting FOMC members could pencil in rate increases for the remainder of the year.
Yet the broader rate outlook has shifted in a more dovish direction over the past week. The CME FedWatch Tool shows the probability of a rate hike by December has dropped from 70% to 58% — a notable swing that bolsters the case for non-yielding assets. That shift stands in sharp contrast to the hawkish repricing that sent gold tumbling from its record high earlier this year.
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Structural demand from reserve managers provides an additional safety net. A World Gold Council survey conducted between February and May found that 45% of central bank reserve managers intend to increase their gold holdings over the next twelve months — the highest proportion since the survey began in 2018. A further 89% expect total central-bank reserves to rise globally, while physical buying from China and India remains robust.
On the charts, gold added 0.3% to $4,342 an ounce, pushing its seven-day gain to 6.5%. The metal has recouped key ground since correcting to around $4,000 in early March. The next resistance level lies at roughly $4,381, just above yesterday’s close of $4,361.50. Despite the recent bounce, gold is still about 22% below its January high of $5,626.80 and well off the all-time peak of $5,594.
Major investment banks remain overwhelmingly bullish. Goldman Sachs targets $5,400 by year-end, JPMorgan $6,000, Morgan Stanley $5,200, and UBS $5,500 — all implying 25%–44% upside from current levels. The outcome of Warsh’s first policy communication will determine whether that optimism gains traction or the metal faces another correction.
The geopolitical backdrop remains fluid. While the Iran memorandum has eased tensions — and oil prices — the signing ceremony in Geneva on Friday, featuring US Vice President JD Vance and Iranian negotiator Mohammad Bagher Ghalibaf, carries execution risk. Delays in mine clearance or renewed hostilities could quickly reverse the détente, adding a layer of uncertainty that gold traders will be watching closely.
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