Asset Watch
Tuesday, 16 September 2025
Gold surged to an all-time high in today’s session, nearing $3,700 per ounce. The dollar’s decline comes as markets grow increasingly convinced that the Federal Reserve will resume interest rate cuts at tomorrow’s meeting, following months of hesitation due to elevated inflation.
Key factors behind gold’s rise include persistent geopolitical tensions (most notably the Russia-Ukraine war and ongoing tensions in the Middle East) along with robust demand from central banks. The People’s Bank of China, for instance, has added roughly 38 tons of gold to its reserves since November 2024.
Attention now turns to the Fed’s policy decision, where a 25-basis-point rate cut is widely anticipated. Investors will also scrutinize the Fed’s updated economic projections for growth and inflation, as well as the dot plot, which will reveal FOMC members’ views on the path of interest rates in the near and medium term, and whether they align with market expectations for three cuts this year.
In addition, markets will closely follow Fed Chair Powell’s press conference for further insight into monetary policy, particularly given the growing influence of President Trump over the Federal Reserve Board of Governors. This has raised concerns about the Fed’s independence, which, if undermined, could weigh further on the dollar and in turn support precious metals.
Earlier this month, gold broke above its April 22 high, clearing the $3,500 barrier and extending its rally to record highs near $3,700 today. A daily close above this level would confirm strong bullish momentum and could pave the way for gains towards the $3,800 mark. Still, the $3,750 psychological resistance level remains a hurdle to watch.
Failure to secure a daily close above $3,700 may signal weakening momentum, which may prompt profit-taking among bullish traders. This could drive prices back toward the $3,600 level.
The Relative Strength Index remains in overbought territory (above 70), underlining the strength of the rally. However, a dip below 70 would signal a potential correction, increasing the likelihood of a pullback in gold prices.
Chart Source: ADSS Platform