Gold outlook: MCX gold reclaims Rs 1 lakh mark amid Fed rate speculation; what should you do?

Gold prices witnessed a strong rally on Friday, driven by renewed expectations of a US Federal Reserve rate cut following Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Symposium. The October 2025 MCX gold contract closed Rs 956 higher per 10 gm, reclaiming the psychologically significant Rs 1-lakh mark. On the international front, COMEX gold also strengthened, finishing 1.09% higher at $3,418.50 per troy ounce, signaling broad-based buying interest across markets.

Rate cut optimism

Market participants interpreted Powell’s remarks as a clear signal that the Fed remains data-dependent and ready to adjust rates if economic conditions warrant it. This has fueled expectations of a 25 basis point rate cut in the upcoming September 2025 FOMC meeting. The prospect of a softer US dollar following such a cut is expected to support gold prices both in domestic and international markets. Analysts have highlighted key resistance levels for traders: ₹1,01,400 for MCX gold and $3,410 per troy ounce globally. Sustained moves above these levels on a closing basis could pave the way for a renewed bullish trend in gold.

Ross Maxwell, Global Strategy Lead at VT Markets, explained, “Powell’s speech confirmed the Fed’s flexibility in monetary policy, increasing the likelihood of a rate cut in September and potentially further reductions later in the year. This drove immediate gains in MCX gold as traders anticipated cheaper gold prices amid a weakening USD. Investors are advised to remain cautious, keeping a close watch on US inflation and future Fed commentary for confirmation of the trend.”

Market reactions

Sugandha Sachdeva, Founder of SS WealthStreet, pointed out that Powell’s remarks have strengthened hopes for the much-anticipated rate cut, ending nearly eight months of policy status quo. She observed that his indication of responsiveness to a cooling labor market triggered a sharp 0.90% decline in the US dollar index, boosting gold’s attractiveness as an alternative investment. Sachdeva also noted that political pressure on the Fed to ease monetary policy further increases the probability of accommodative action in the near term.

Domestically, Aksha Kamboj, Vice President of the India Bullion & Jewellers Association (IBJA) and Executive Chairperson at Aspect Global Ventures, emphasized that gold continues to be perceived as a safe haven amid global uncertainty and rising US dollar volatility. “Jewellery demand remains subdued, but prices near ₹99,358 per 10 gm are drawing renewed interest from jewellers ahead of the festival season. The market is balancing domestic demand with global monetary developments, particularly anticipated Fed indicators,” she said.

Outlook for Gold

From a technical perspective, analysts see strong support for gold at Rs 97,000–Rs 98,200 per 10 gm in India and $3,280–$3,310 per ounce internationally. While short-term volatility cannot be ruled out, the broader trend remains constructive as long as these support levels hold. Sachdeva added that a sustained breakout above Rs 1,01,400 domestically or $3,410 internationally could trigger further upside, potentially setting the stage for a fresh bull phase in gold markets worldwide.

In summary, Powell’s Jackson Hole remarks have reignited market optimism for a US Fed rate cut, triggering strong buying in gold. Both domestic and international markets are likely to remain sensitive to USD movements and upcoming economic data, with investors closely monitoring technical levels to gauge the next leg of the rally.