Meanwhile, Silver is also seeing strong gains, trading at $119.13 with a 1.96% rise, as safe-haven demand grows amid global uncertainties and US dollar weakness.

Geopolitical Tensions and Dollar Weakness Push Gold Higher

On the geopolitical front, concerns about US tariffs have returned after Germany, the Eurozone’s largest economy, lowered its growth forecasts for this year and next. Meanwhile, the tension is also rising in the Middle East, as US President Donald Trump warned Iran to come to the table on nuclear weapons, or face stronger attacks. Iran fired back, threatening the US, Israel, and their allies.

Meanwhile, Russia keeps hitting Ukrainian cities, with a recent drone strike on a passenger train killing five people. All this uncertainty, along with some selling of the US dollar, is keeping Gold in demand.

Fed’s Steady Rates and Political Concerns Give Gold a Boost

On the US front, the Federal Reserve kept interest rates unchanged after its two-day meeting, as most expected. Two Fed officials, Stephen Miran and Christopher Waller, wanted a small cut instead. Fed Chair Jerome Powell said inflation is still higher than the 2% target, but markets barely reacted. Meanwhile, worries are growing that the Fed may not be fully independent, with a DOJ investigation into Powell and efforts to remove Governor Lisa Cook raising concerns about political pressure.

For now, traders expect rates to stay steady through this quarter and possibly until Powell’s term ends in May, though two cuts are priced in for 2026. This outlook is keeping the US Dollar from gaining much and giving Gold a boost, as investors favor the safe-haven metal. All eyes are now on Thursday’s jobless claims data for fresh market movement.

Gold Prices Forecast: XAU Holds Above $5,500: Fibonacci Support Keeps Bullish Structure Intact