Gold and Silver Price Forecast: Fed Caution, Tariffs Stoke Geopolitical Bids

Author: Arslan Ali

Updated: July 10, 2025

Market Overview

Gold (XAU/USD) has seen a significant rally, trading near $3,323 as investors flock to safe-haven assets amidst escalating global trade tensions. This surge follows U.S. President Donald Trump's announcement of new tariffs on eight trading partners and a 50% tariff on copper imports, which has heightened geopolitical risks and prompted a shift away from risk-sensitive assets.

Federal Reserve Signals

The minutes from the Federal Reserve's June meeting indicate that while there are concerns about inflation driven by tariffs, only a few officials support immediate rate cuts. The market has reacted, with Treasury yields softening, which has further supported gold prices. The CME FedWatch Tool now shows a 68% probability of at least one rate cut by December, up from 60% earlier in the week. Lower interest rates typically make non-yielding assets like gold more attractive.

Silver Market Dynamics

Silver (XAG/USD) is also experiencing upward movement, trading near $31.00. However, its gains are limited due to concerns about industrial demand. Technical analysis indicates resistance around the $31.25–$31.50 range, with support at $30.10. Analysts note that silver's dual role as both an industrial and monetary metal makes it susceptible to economic fluctuations and safe-haven demand.

Upcoming Economic Indicators

Market participants are closely monitoring U.S. weekly jobless claims data and comments from Federal Reserve officials for further insights into monetary policy. A robust labor market could delay any easing measures, potentially capping short-term gains in precious metals.

Short-Term Forecast

Gold is poised for a breakout above $3,330, while silver is testing key resistance near $36.86. Both metals are sensitive to macroeconomic developments and shifts in Federal Reserve policy expectations.

Technical Analysis

Gold (XAU/USD)

Gold is consolidating near $3,325, just below a critical resistance level formed by the 200-period EMA at $3,329.88. A sustained move above $3,330 could signal a breakout, potentially leading to resistance zones at $3,345 and $3,363. Conversely, failure to breach this level may result in a pullback, with initial support at $3,308.

Silver (XAG/USD)

Silver is trading around $36.60 after rebounding from trendline support at $36.15. It has surpassed both the 50-period EMA ($36.56) and the 200 EMA ($36.29), indicating bullish momentum. A decisive close above $36.86 could lead to further gains, while key support lies at $36.48 and $36.15.

Conclusion

Both gold and silver are currently influenced by geopolitical tensions and Federal Reserve policy signals. Investors should remain vigilant regarding upcoming economic data and Fed commentary, as these factors will likely dictate the short-term trajectory of precious metals.