Gold is drawing support from expectations that the Federal Reserve will keep interest rates unchanged for the rest of the year, following softer US inflation and employment readings. That view has coincided with stabilisation at the short end of the yield curve and a weaker US Dollar narrative, encouraging money managers to add long exposure in the metal, while some positions retain downside hedges against oil-driven policy shocks.
Energy Market Volatility and Geopolitical Tensions
Near-term upside remains capped by energy price volatility linked to tensions in the Middle East, with hostilities in the Persian Gulf leaving supply routes exposed. An oil price spike could revive inflation concerns and prompt a repricing towards higher Fed funds rates this year and next.
Forecast for Gold Prices
TD Securities expects these forces to keep gold range-bound between $4,200 and $4,500 per ounce into early 2027, with scope for a move higher later in 2027 once inflation pressures ease.
