Record Highs and Corrections
Gold prices experienced significant volatility last week, initially soaring to record highs due to safe-haven demand amid geopolitical and economic uncertainties. Key catalysts included U.S. President Donald Trump’s criticism of Federal Reserve Chair Jerome Powell and concerns over prolonged U.S.-China trade tensions.
- Trump warned that the U.S. economy could slow unless interest rates are cut immediately, increasing pressure on the Fed.
- Concerns over prolonged U.S.-China trade tensions continued to weigh on gold prices.
- Trump backed away from firing Powell and signaled optimism over potential trade negotiations with China.
- U.S. Treasury Secretary Scott Bessent suggested de-escalation but offered no clarity on timelines.
Global Sentiment
Global sentiment was rattled by the IMF’s downgraded global growth forecast to 2.8% for 2025, with inflation expectations revised upward. The IMF warned that the world is facing a “perfect storm” of economic uncertainty, which could lead to a recession.
- Downgraded global growth forecast to 2.8% for 2025
- Inflation expectations revised upward
- IMF warns of a “perfect storm” of economic uncertainty
- Potential recession
Central Bank Independence and Inflation Expectations
Investor attention remains focused on central bank independence, elevated inflation expectations, and uneven U.S. economic data, including mixed PMI readings and durable goods orders. Markets now await comments from Fed officials for policy direction.
| Category | Current Status |
|---|---|
| Central Bank Independence | Uncertain |
| Inflation Expectations | Elevated |
U.S.
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