Gold’s record run stalls with fed policy in focus

September 17, 2025 (MLN): Gold prices eased on Wednesday as a firmer U.S. dollar and profit-taking pulled the metal back from record highs hit in the previous session, with investors awaiting the Federal Reserve’s policy decision for further direction.

Spot gold was down 0.36% at $3,668.56 an ounce as of [2:50 pm] PST, according to data reported by Mettis Global.

U.S. gold futures for December delivery slipped 0.2% to $3,718.90 an ounce.

The pullback followed a surge past $3,700 on Tuesday, driven by dollar weakness and expectations that the Fed will begin cutting interest rates.

“Gold’s ascent to $3,700 was aided by the decline in the USD and by bets that the Fed may signal that follow-up rate cuts are likely to arrive before year-end,” said Tim Waterer, chief market analyst at KCM Trade to CNBC.

 “Profit-taking around this level saw the precious metal dip back below it. But should the Fed adopt a particularly dovish tone in their meeting, gold could be making another move higher.”

The dollar index edged up 0.1% after falling to a more than two-month low on Tuesday, while benchmark 10-year Treasury yields hovered near a five-month trough.

Tuesday’s data showed U.S. retail sales rose more than expected in August, though analysts warned that a weakening labor market and higher prices from tariffs could weigh on consumer spending in the months ahead, according to CNBC.

Markets broadly expect the Fed to deliver a quarter-point rate cut later on Wednesday to support the labor market.

Traders will be closely monitoring remarks from Chair Jerome Powell for clues on the pace of future easing. Lower interest rates reduce the opportunity cost of holding non-yielding assets such as bullion.

U.S. President Donald Trump has continued to pressure the Fed, calling for a “bigger” rate cut.

Investor demand for gold remains strong. SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.32% to 979.95 metric tons on Tuesday from 976.80 tons a day earlier.

In other precious metals, spot silver fell 1.3% to $41.98 an ounce, platinum inched up 0.1% to $1,392.25, and palladium gained 0.5% to $1,182.21.

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