Weekly Gold Price Predictions: 30 Jun - 6 Jul ‘25

Gold Prices Fall as Geopolitical Tensions Subside

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The gold price is losing its luster due to market participants becoming increasingly optimistic about the global economy. 

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News of the trade deal with China, as well as those with other countries, including South Korea, Vietnam, and the EU, was welcomed by investors.  

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The pivot away from safe havens comes at a time when global tensions are cooling on all fronts, war jitters are toning down, tariffs have plateaued and are still in the grace period before they’re brought up again as a topic.

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Regarding geopolitics, Iran has shown signs of flexibility, leaning toward diplomacy, as its representative in the UN said that Tehran is open to forming a regional nuclear consortium in the event of an agreement with Washington.

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Adding to the upbeat mood is the possibility of the end of the Israel–Gaza war within two weeks, revealed Al Arabiya.

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The United Kingdom government announced in a press release on Monday that the UK-US trade deal has officially come into force.

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The UK car manufacturers can now export to the US under a reduced 10% tariff quota. The UK aerospace sector will have 10% tariffs on goods like engines and aircraft parts removed.

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That calmer geopolitical backdrop is dulling the shine on gold’s safe-haven appeal. Traders seem less interested in holding hedges and more focused on chasing yield.

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Another key driver for investors to bet on a possible Fed rate cut as soon as July or September arrived when the PCE report was released. The Fed’s preferred inflation gauge showed prices rose 2.7% in May from last year, a notch higher than the 2.6% expected.

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Gold vs US Dollar

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The dollar dropped to a three-and-a-half-year low as traders bet that the Federal  Reserve will cut rates more times and possibly sooner than previously expected, as some U.S. data points to a weakening economy. 

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Traders are pricing in 65 basis points of cuts by year-end, up from 46 basis points a week ago.

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Reports that U.S. President Donald Trump could also appoint a replacement for  Powell in the coming months have added to dollar weakness.

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The new Fed chair is expected to be more dovish, and an early appointment could undermine  Powell’s influence by acting as a shadow chair before Powell’s term ends in May.

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But the dollar retraced earlier losses against the euro on Friday after U.S.  President Donald Trump said the United States was ending trade talks with Canada and that he would consider bombing Iran again, denting risk appetite and sending stocks lower.

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Gold Price Prediction

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Taken together, both messages highlight how erratic Trump is and that any assumptions built into markets can be instantly undermined.

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Trump also sharply criticised Iran's Supreme Leader Ali Khamenei, dropped plans to lift sanctions on  Iran and said he would consider bombing Iran again if Tehran is enriching uranium to worrisome levels.

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Foreign investors view the long-term outlook for the dollar as challenging, as they re-evaluate the "American exceptionalism" that has attracted investment to the country.

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Former President Joe Biden cut off Russia’s access to the U.S. dollar, froze its assets and imposed sanctions following the country’s invasion of Ukraine in 2022, and led other countries to accelerate shifts away from U.S. dollar reliance.

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Gold prices for August are currently supported by the uptrend line that has been in place for the last six months. For a bullish continuation, gold must climb past $3300.

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If surpassed, up next resistance is $3400. On the flip side, should gold fail to consolidate around current price levels and fall below $3270, the next significant price floor will be around $3200.

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Disclaimer: The recommendations and opinions shared by experts regarding the stock market and other asset classes are their own. These views do not reflect the official stance or position of Jar.

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