Gold: "3.700"
The US Federal Reserve sends the price of gold to new record levels, including fluctuations due to uncertain interpretations. Commodities analyst Blumenroth summarizes the week in gold trading.
18 September 2025. FRANKFURT (Xetra-Gold). As was the case last week, we can once again use a number as our headline, suggesting that something unusual has happened again in recent days. And indeed, in the run-up to yesterday's interest rate decision by the US Federal Reserve, the financial markets were already in a state of joyful anticipation. After US statisticians reported an increase in weekly initial jobless claims to their highest level since October 2021 last Thursday, the rally in gold prices accelerated, as did the downward pressure on the US dollar – although it should be noted that, according to analysts, this data may have been distorted by erroneous data from Texas, meaning that a correction is possible.
Fed cuts US key interest rate for the first time this year
After the ECB once again expressed satisfaction with the current interest rate level and inflation rate development last Thursday, analysts are increasingly viewing the interest rate cut cycle in the eurozone as over, whereas the cycle in the US, which had been interrupted since the beginning of the year, resumed yesterday. This has put pressure on the US dollar in recent days, with the euro trading at its highest level against the greenback since September 2021. Gold prices also received further tailwind from speculation about Fed interest rate cuts, surpassing the US$3,700 per ounce mark for the first time on Tuesday.
Yesterday evening, the Fed went “live.” As expected, it lowered its key interest rate by 0.25 percentage points to 4.00 to 4.25 percent and forecast – albeit by an extremely narrow majority of 10 to 9 members – two further interest rate cuts of 0.25 percentage points each for the two meetings at the end of October and mid-December. For 2026 and 2027, the monetary authorities expect only one interest rate cut each on average, resulting in a long-term key interest rate of 3.0 percent.
Fed decisions: Focus on inflation, economy, and labor market
The interest rate move had been expected, but reading the Fed's subsequent statement, it may have come as something of a surprise. Compared to its June meeting, the Fed raised its economic growth forecasts for 2025 to 2027 and lowered its unemployment rate forecasts for 2026 and 2027 slightly, while raising its inflation forecast for 2026 by 0.2 percentage points to 2.6 percent. The inflation target of 2.0 percent is not expected to be reached again until 2028. High inflation, a robust economy, and a strong, albeit recently somewhat weakening, labor market – this could also mean that the Fed will not cut key interest rates as much as currently expected.
Gold price between record high and profit-taking
For this reason, the market movements that had pushed the euro to a four-year high against the US dollar and the gold price to a new record high of US$3,707.50 per ounce immediately after the Fed statement was released reversed course. The euro lost one cent against the US dollar, and the gold price fell by around US$50 per ounce. Another factor here is that market players had already positioned themselves so heavily in euro/US dollar and gold long positions in the run-up to the Fed meeting that follow-up buying failed to materialize after the meeting, prompting profit-taking.
While gold prices were still trading at US$3,630 per ounce on Thursday morning last week, they initially traded sideways between US$3,615 and US$3,655 until Monday afternoon. The increasingly weaker US dollar then gave gold prices a fresh boost. On Monday, they climbed to $3,685, and on Tuesday, a new record high of around $3,703 was reached. Due to profit-taking, prices fell back to $3,660 at midday yesterday. After the Fed meeting, they rose to $3,707.50 per ounce, then fell to around $3,650. Gold started today's trading at around $3,655 per ounce.
Xetra Gold temporarily exceeds €100 per gram
The Xetra Gold price was slowed down slightly by the continuing rise of the euro. Nevertheless, a new record high was achieved over the course of the week. During normal trading hours, it initially fell from €99.85 per gram on Thursday morning last week to around €99.25. With the rise in the US dollar price of gold, the Xetra Gold price also rose at the beginning of the week, reaching a new record high of €100.80 on Tuesday morning. After a setback to €99.45, yesterday's trading day ended at €100.10 ahead of the Fed meeting. If the price at 7 a.m. is still valid at the start of trading, Xetra Gold is likely to start trading at around €99.60 per gram this morning.
For now, the markets are likely to be preoccupied with forming a consistent opinion on the Fed's communication. With the Bank of England meeting at noon today and the Bank of Japan meeting tomorrow morning, other central banks are also set to announce interest rate decisions, followed by Sweden and Switzerland, among others, next week.
by Michael Blumenroth
Michael Blumenroth
18 September 2025 © Deutsche Börse AG
Deutsche Börse 
