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Gold (XAU\/USD) pushes deeper into uncharted territory on Tuesday, climbing to another record high as expectations for further Federal Reserve (Fed) interest rate cuts and lingering geopolitical risks underpin steady safe-haven demand. At the time of writing, XAU\/USD is trading around $3,780, after hitting a fresh all-time high of $3,791 earlier in the day.<\/p>\n
Market focus remains on the Fed\u2019s monetary policy outlook following its 25-basis-point (bps) cut last week, with traders pricing in the likelihood of two more reductions before year-end. Lower borrowing costs typically weaken the US Dollar (USD) and Treasury yields, reducing the opportunity cost of holding Gold.<\/p>\n
Still, comments from Fed officials on Tuesday suggested a cautious stance toward further easing. Fed Chair Jerome Powell<\/a> cautioned that \u201ctwo-sided risks mean that there is no risk-free path\u201d for monetary policy. He warned that easing too aggressively could leave \u201cthe inflation job unfinished and need to reverse course later,\u201d while keeping policy restrictive for too long might cause the labor market to soften unnecessarily. Powell added that policy remains \u201cmodestly restrictive,\u201d which he said leaves the Fed well positioned to respond to evolving economic conditions.<\/p>\n Vice Chair Michelle W. Bowman said that last week\u2019s quarter-point cut should be seen as a first step toward a more neutral stance, warning that the labor market could weaken rapidly and policy may need to adjust more quickly if risks materialize. Fed\u2019s Austan Goolsbee added that while\u00a0rates<\/a>\u00a0can come down if inflation trends toward the target, he is not considering 50-basis-point cuts, describing policy as only mildly restrictive and noting that neutral is likely 100-125 basis points below current levels.<\/p>\nMarket movers: Fed caution and geopolitical risks keep Gold in demand<\/h2>\n
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Technical analysis: XAU\/ USD bulls unstoppable despite overbought conditions<\/h2>\n