Gold forecast to stay flat this week

The Kitco News Survey, which polled 14 analysts last weekend, found that eight, or 57%, expect the precious metal to remain flat while the rest were evenly split between a rise and a decline.

Gold closed last week near the US$4,000-per-ounce mark, marking its second consecutive weekly loss.

The U.S. Federal Reserve lowered interest rates last Wednesday, yet Chair Jerome Powell’s hawkish comments have led markets to scale back expectations for another cut in December, with the probability falling to 63% from more than 90% earlier in the week, according to the CME FedWatch tool.

Gold tends to lose its appeal when interest rates rise, as it offers no yield. The metal has climbed 53% so far this year, reaching an all-time high of $4,381.21 on Oct. 20.

"It's still early, we just had the Fed meeting, but I think they may be okay with where things are right now," Daniel Pavilonis of brokerage RJO Futures told Kitco News.

The Fed is in a tight spot, having to balance supporting the labor market with dealing with inflation risks, Pavilonis said. But he believes gold will still go up in the long run.

Morgan Stanley also noted its positive outlook for the metal last Friday, citing potential interest rate cuts, strong ETF inflows, central bank buying and persistent economic uncertainty as key drivers. The bank forecasts the metal will average $4,300 in the first half of 2026, as quoted by Reuters.

Meanwhile, Alex Kuptsikevich, senior market analyst at forex broker FxPro, said the gold price correction is not yet over.

"The strengthening of the U.S. dollar and higher Treasury yields have brought the gold price back below $4000," he said, pointing to the resolution of the Middle East conflict, easing U.S.-China trade tensions and a more cautious Federal Reserve.

Last Saturday, China said it would stop allowing certain retailers to deduct value-added tax on gold purchased from the Shanghai Gold Exchange or the Shanghai Futures Exchange, whether the metal is sold directly or after processing.

"While Chinese gold demand has played little part in this year’s record bull market, the tax changes in gold’s heaviest consumer nation will dent global sentiment," Adrian Ash, director of research at online gold marketplace BullionVault, told Bloomberg.

"This news could prove very welcome to traders and investors hoping for a deeper correction after last month’s spike."

Marc Chandler, managing director at capital markets trading firm Bannockburn Global Forex, forecast that gold can draw in new buying if it can rise above $4,075 this week. However, if it falls below recent lows, prices could further retreat to around $3,750.

This week, the U.S. economy will see several key data releases, including the Purchasing Managers’ Index (PMI), the private-sector employment report and the consumer confidence survey. These could set a direction for gold prices in the short term.