Gold Price Prediction: Outlook for August 26, 2025

Gold prices are anticipated to rise, particularly with signals from US Federal Reserve Chair Jerome Powell regarding potential cuts in interest rates. There’s also the impact of the Donald Trump administration’s 50% tariffs on India to keep an eye on.

Gold Performance:

• During his expected speech at the Jackson Hole Symposium, Powell shifted focus from inflation to the job market, which has increased the possibility of rate cuts in September. Following his remarks, gold rebounded, rising 1% to $3,372, recording a weekly gain of 1.1% by August 22nd.
• On August 25th, Spot Gold saw an increase of $2, reaching $3,374. Meanwhile, the Rs 100,665 MCX October Gold contract rose by 0.28%.

Powell’s Remarks at Jackson Hole:

• In his much-anticipated speech, Powell discussed the balanced labor market amid concerns over a slowdown in worker supply and demand. He noted significant downward revisions in previous months’ labor data and commented on how tariffs could lead to employment risks through successive layoffs and rising unemployment.

Geopolitical Developments:

• USA – Venezuela: The US has deployed three warships into the Southern Caribbean to combat local drug trafficking. At the same time, tensions with Venezuela’s Maduro government are rising, particularly as Trump’s Attorney General raised the bounty on Maduro to $50 million.
• Israeli Air Strikes: Israeli forces targeted oil facilities and power plants in Yemen’s capital, Sanaa, along with the presidential palace, an action directed against Iranian-backed Houthi forces.

Federal Reserve Outlook:

• The Justice Department recently called for the removal of Federal Reserve Governor Lisa Cook, alleging her involvement in Fed fraud. However, such decisions are ultimately up to the President.

Trade and Tariffs Update:

• President Trump has initiated a customs investigation focusing on furniture imports and hinted at imposing duties within the next 50 days, but hasn’t disclosed specific rates yet.
• The 50% tariff on Indian goods is set to take effect on Wednesday.
• The Swiss Post has halted some package services to the US as the Trump administration closes a customs loophole affecting “minimal” goods, with new exemptions for retail prices below $800 starting on August 29th.

Data Summary:

• US New Home Sales for July came in at 652K, surpassing forecasts of 630K.
• Germany’s IFO Business Environment Index increased from 88.60 in July to 89 in August.

Dollar Index and Yields:

• Following Powell’s speech, the US dollar index fell by 0.90% to 97.72. However, yields started to recover afterward, with the dollar hovering around 98.11 and yields for 2 and 10-year notes at 3.73% and 4.28%, respectively.

Gold ETF Status:

• As of August 22nd, global gold ETFs reached 92.366 million ounces, a notable increase of over 11% year-to-date, nearing a two-year high.

Future Data Releases:

• This week will see significant US data releases, including Durable Goods (August 26) and the Second Quarter GDP Secondary Reading (August 28).
• Important eurozone data will include retail sales (August 29) and consumer trust (August 28).

Gold Price Outlook:

• Powell’s focus on the job market over inflation suggests support for possible interest rate cuts in September. As investors look at the upcoming pay report and CPI data, gold’s resistance needs to break above $3,410 to aim for $3,450, with support levels identified at $3,346 and $3,319.

Overall, while the outlook seems positive, domestic buyers should stay alert regarding upcoming tariffs, particularly the forthcoming 50% tariffs on Indian goods.