Gold Price Outlook: XAU/USD Holds Below $3,400 Amid Fed Policy and Iran Tensions

Gold Price Outlook: XAU/USD Holds Below $3,400 Amid Fed Policy and Iran Tensions

Published: June 19, 2025 | 🖋️ Tredu Commodities Desk

Gold Struggles to Break Above $3,400

Gold (XAU/USD) is trading cautiously below the $3,400 mark during Thursday's European session as traders await clarity on whether the United States will take military action against Iran. The precious metal remains caught between geopolitical uncertainty and hawkish Federal Reserve projections.

Fed Keeps Rates Steady, Raises Long-Term Targets

On Wednesday, the Federal Reserve left interest rates unchanged for the fourth consecutive meeting at 4.25%–4.50%, but adjusted its longer-term rate projections upward:

• 2026 rate target: 3.6%
• 2027 rate target: 3.4%

The Fed’s upward revision reflects concerns about inflation persistence, particularly from potential US tariffs under President Donald Trump's policy trajectory.

Gold Supported by 20-Day EMA, Faces Resistance

From a technical perspective:

• Support: 20-day Exponential Moving Average (EMA) near $3,365
• Resistance: Psychological level at $3,400

Although gold is traditionally a safe-haven hedge against inflation and uncertainty, higher long-term interest rates reduce its appeal as a non-yielding asset.

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