Gold seems to have taken a breather, as all asset prices do after a long run. Gold is trading within a tight range of $3,200 – $3,350, after hitting an all-time high of $3,500 in April. Gold price today in India is Rs 98,220 and has also been trading in a narrow range for the last 2 months.
Over the past three months, the price of gold has fallen by 4% from its record high. However, YTD gold is up 27% and a staggering 40% over the last 12 months.
So, what has stalled the gold rally? And, most importantly for investors, is the bull run in gold over, or is it waiting for fresh triggers?
Nobody knows and neither should any investor rely on predictions.
So, let’s try to see what factors are at play currently to make informed decisions on gold’s future outlook.
The Push for Gold
Gold rallied from $1,500 in October 2022 to the current levels of $3,350. But what were the reasons behind it? Are they still valid?
Initially, it was the war-like situations that were center-stage. Gold demand increased as a result of the rapidly shifting geopolitical landscape involving the forces of Russia, Ukraine, Israel, and Iran.
That appears to be sorted, at least for now.
Then came Trump’s tariffs, which had the potential to disrupt global trade by sparking trade conflicts among countries.
But, shifting of deadlines and Trump’s softer stance on specific countries immediately signaled that the impact would not be as severe as previously thought.
Triggers at Play Now
Today, the US economy is looking pretty stable, with job numbers showing the resilience that the American economy requires. The only red flag is the high level of interest payments that the US has on its multi-trillion-dollar debt.
As of July 17, 2025, the US federal debt is $36.62 trillion. So far, till June 2025, $900 billion has been repaid as interest. The day is not far when the annual interest payout on US debt crosses 1 trillion dollars!
Expect a spike in gold on that day, possibly.
The one thing that can save America millions of dollars in interest outgo is the federal funds rate. If the US Fed reduces rates, the interest burden on US debt falls.
There’s a problem. In the US Fed’s scheme of things, Trump’s tariff would be inflationary.
But if tariffs show no major impact on the prices of goods in America, the US Fed will start cutting rates. To date, not much impact has been witnessed on inflation, although a 10% tariff has been in place since February.
In that case, there’s a big enough room for rates to fall. Currently at a 4.25%-4.5% range, at least 300bps of rate cuts are expected starting in September.
With that, the interest burden on US debt comes rolling down.
But wait, here’s another twist to the tale. With rates falling, gold may shine further if geopolitical and global economic risks continue to exist. This could be a trigger for gold.
Gold and interest rates are inversely related and when there are economic risks around, investors choose to park money in gold rather than other dollar-denominated assets.
Talking of the dollar, any further weakness in the dollar index will boost gold prices. The dollar index is already down over 9% this year, trading much below the 100-mark.
A weak dollar also signals a deteriorating economy. This could be another gold trigger.
Meanwhile, another Trump factor has popped up. Trump wants Jerome Powell, the Chair of the Board of Governors of the Federal Reserve System, to cut rates in a fast and furious style. Trump said Powell has already delayed rate cuts, and he should immediately cut the rate by 3%.
Powell and team are wary of the tariff impact on inflation and have chosen to stay put without changing rates since December.
Although Trump denied removing Powell from office, the US administration is putting a lot of pressure on him to make him resign before his term ends in May 2026.
Now, such interference from the White House in the operations of an independent central bank is being seen negatively by global investors.
The erosion of the US Fed’s credibility could be another trigger for gold. Gold, known for being a safe haven during political and economic turmoil, is expected to gain more in such an event.
Bull’s Eye for Gold
For the time being, the US economic data, movement in the dollar index, US Fed rate cuts, and the economic situation amid Trump tariffs remain the biggest support level factors for gold.
Central banks are buying consistently, even as investors are pouring money into gold-backed funds.
Investors in gold need to keep an eye on the U.S. dollar. It could be the one single indicator that could set the direction for gold in the months ahead, if not weeks.
And, unless any other fresh trigger takes place, the next big push for the gold to rally much higher remains uncertain. If there is one, we will tell you first. Just keep following our Gold Pulse page.