Gold prices are steady amid Fed concerns about recession risks and inflation.
On Wednesday, gold prices stayed the same while investors intently studied the minutes from the early May meeting of the U.S. Federal Reserve. Key elements that still sustain gold’s function as a safe-haven asset during difficult economic times—that is, continuous worries about rising inflation and the impending recession—were exposed in the report.
Spot gold was largely unchanged at \$3,299.95 per ounce, while U.S. gold futures edged down by 0.2%, closing at \$3,294.90 per ounce.
“The gold market remains in a choppy trading pattern, largely influenced by the constant stream of new economic data and geopolitical developments,” said Jim Wyckoff, senior analyst at Kitco Metals. “There’s no strong directional momentum right now, but the underlying demand for safety is still very much present.”
The meeting of the Federal Reserve on May 6–7 highlighted the delicate balance that policymakers must maintain. Officials warned of “difficult tradeoffs” shortly, as the economy faces simultaneous pressures from rising prices and elevated unemployment levels. These dynamics have only intensified speculation about a possible economic downturn.
The meeting occurred shortly after President Donald Trump announced sweeping import tariffs in April, which triggered renewed global trade tensions. Although some of the most aggressive tariffs were later softened or delayed, uncertainty continues to hang over global markets.
Under such conditions, gold typically thrives due to low interest rates and investor preference for secure investments. Gold has surged 26% year-to-date, reaching an all-time high in April amid ongoing demand and rising doubts about the viability of conventional financial institutions.
Goldman Sachs added fuel to the bullish outlook on Wednesday, advising investors to maintain an above-average allocation to gold in their long-term portfolios. The investment bank cited mounting risks to U.S. institutional credibility, ongoing pressure on the Federal Reserve, and persistent central bank purchases of gold worldwide.
Investors are now focusing on key upcoming economic indicators, including Thursday’s U.S. GDP report and Friday’s Consumption Expenditures (PCE) data, along with planned presentations by Federal Reserve officials that might provide more clarity on the direction of monetary policy.
In international trade, data showed that gold imports to Switzerland from the U.S. soared in April, reaching their highest level in over a decade. The rise followed the removal of precious metals from U.S. import tariffs, which opened up new flows of bullion into one of the world’s major refining and trading hubs.
Activity in the larger precious metal market was erratic, meanwhile. Spot silver slid 0.9% to \$32.99 an ounce; platinum edged up 0.1% to \$1,081.09; palladium dropped 1.2% to \$967.10.
Gold’s timeless allure as a store of value stays very much in focus as world markets struggle with geopolitical concerns, inflation, and economic uncertainty.
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