However, this type of pressure is viewed as mechanical rather than sentiment-driven. Gold remains up over 15% this year, supported by record central bank buying, strong institutional interest, and ETF inflows. The pullback may prove temporary unless supported by fresh macro shifts.

Trade Policy Uncertainty and Recession Fears Still Dominate

The underlying drivers of the rally are unchanged. Allianz’s Mohamed El-Erian now puts U.S. recession odds at 50%, while Goldman Sachs raised its estimate to 35%. Fed Chair Jerome Powell warned that Trump’s tariffs are “larger than expected,” with fallout likely to include both slower growth and elevated inflation. With global supply chains under renewed stress, gold’s role as a hedge remains central.

Next Week Brings CPI and Fed Minutes Into Focus

Traders will be glued to Wednesday’s FOMC minutes and Thursday’s CPI report. If the Fed minutes show internal debate or reluctance to ease aggressively, that could temper some of the rate-cut enthusiasm priced into markets. Conversely, if CPI surprises to the upside, it would reinforce inflation risks and justify gold’s safe-haven appeal—even if policy remains cautious. On Friday, consumer sentiment data could further illuminate how recent market stress is filtering through to inflation expectations.

Gold Prices Projection: Pullback Offers Opportunity as Macro Drivers Remain Supportive