Gold Rebounds Above $4,300 After Fed Delivers First Rate Hike Since 2023
Gold prices climbed on Thursday after the Federal Reserve raised interest rates for the first time since 2023, a move that had been widely anticipated by financial markets.
At 4:56 p.m., spot gold gained 1.2% to $4,314.57 per ounce, while gold futures slipped 0.8% to $4,354.09 per ounce. The Fed unanimously approved a quarter-percentage-point increase in the federal funds rate on Wednesday, marking a significant shift in monetary policy.
The central bank’s latest projections signaled a more hawkish outlook. The median forecast for the policy rate at the end of 2026 rose to 4.1% from 3.8%, indicating support for additional rate hikes in the coming quarters. Markets interpreted the guidance as a sign that policymakers remain focused on containing inflation.
Following the decision, U.S. Treasury yields declined across the curve, while the U.S. dollar strengthened.
Higher interest rates generally weigh on gold because the precious metal does not generate interest income. A stronger dollar can also reduce demand by making gold more expensive for buyers using other currencies.
Technical Outlook Remains Under Pressure
Tony Sycamore, Senior Market Analyst at IG, said expectations for another Federal Reserve rate hike later this year, along with an additional 50 basis points of tightening in the first half of 2027, have intensified the headwinds facing gold.
From a technical perspective, Sycamore noted that gold must reclaim its 200-day moving average near $4,539 to signal that the correction from the recent peak of $4,697 has ended and that the broader uptrend has resumed.
Until then, he expects the current decline to extend toward the $4,200 level, with the next major support zone located around $4,000 per ounce.
Fed Chair Kevin Warsh reinforced the central bank’s inflation concerns during the post-meeting press conference. He stated that too many categories of goods and services continue to record annual price increases above 3% over both six-month and twelve-month periods, underscoring the Fed’s commitment to maintaining a restrictive policy stance.