Fed Rate Hike Cements Gold Price Range

The Federal Reserve's recent rate hike has put downward pressure on gold prices, keeping them range-bound. The Fed raised its target range for the federal funds rate by 25 basis points to 3.75%-4.00% and noted that inflation remains elevated.

Most policymakers still see room for further rate hikes this year, according to the latest dot plot. This hawkish stance has led to higher interest rates and a stronger US dollar, which are capping gold's upside potential.

Despite some safe-haven demand due to geopolitical risks, gold prices remain under pressure from high real interest rates and risk-free yields. If energy supplies continue to recover and oil prices ease, the US dollar and yields could keep weighing on gold prices.