Gold posts first weekly gain since May as Fed rate hike fears ease
Synopsis
Gold's first weekly gain since May wasn't just a bounce — it was a signal. With US hiring slowing, the Fed rate-hike probability dropping below 20%, and political pressure on the Fed resurfacing, bullion's 3.1% weekly rise reflects a confluence of macro tailwinds that analysts say could keep prices elevated in the ₹1,45,000–₹1,49,000 range.
Key Takeaways
Gold posted its first weekly gain since May , rising approximately 3.1 per cent over the week ending 4 July .
24-carat gold (10 grams) rose from ₹1,41,911 on Monday to ₹1,46,344 on Friday, per IBJA data.
MCX gold August futures stood at ₹1,47,365 ; MCX silver July futures at ₹2,37,499 per kg .
Probability of a Fed quarter-point rate hike at the next meeting fell to below 20 per cent , down from roughly one-third earlier in the week.
Oil prices posted their sharpest quarterly correction since 2020 , easing inflationary pressure and supporting the bullion rally.
Political pressure on Fed independence — following the Supreme Court blocking the removal of Governor Lisa Cook — added a structural tailwind for gold.
Gold recorded its first weekly gain since May 2025 as trader expectations for further US Federal Reserve rate hikes moderated, lifting bullion prices by approximately 3.1 per cent over the week. Softer US jobs data and declining energy prices were the primary drivers behind the pullback in monetary-tightening expectations.
Weekly Price Movement
The price of 10 grams of 24-carat gold rose to ₹1,46,344 on Friday, 4 July, up from ₹1,41,911 at Monday's market opening, according to data published by the India Bullion and Jewellers Association (IBJA). On the domestic futures market, MCX gold August futures eased marginally by 0.01 per cent, while MCX silver July futures edged up 0.04 per cent. Gold futures were last quoted at ₹1,47,365 per 10 grams, with silver futures at ₹2,37,499 per kg.
What Drove the Recovery
'Gold extended its recovery for the fourth consecutive session and touched a 10-day high on Friday. The rebound comes after more than a month of sustained selling following the May 13 import duty hike, with improving sentiment supported by a softer US dollar,' an analyst said. The analyst added that a pullback in the Dollar Index had encouraged fresh buying in bullion, and forecast that prices are expected to trade in the ₹1,45,000–₹1,49,000 range, with global cues continuing to drive sentiment.
US Labour Data and Fed Rate Outlook
US hiring slowed sharply in June, prompting traders to trim the probability of a quarter-point rate increase at the Fed's next meeting to below 20 per cent, down from roughly one-third earlier in the week. Lower energy costs and softer job growth have led analysts to forecast a gradual easing of inflationary pressures in the coming months. Notably, oil prices have witnessed their sharpest quarterly correction since 2020, as shipments from Saudi Arabia and the United Arab Emirates approach pre-war levels.
Fed Independence Under Pressure
US President Donald Trump and allies have renewed efforts to install more of the president's own picks at the Federal Reserve, following a Supreme Court ruling that blocked an attempt to remove Governor Lisa Cook. Similar efforts last year — which challenged the Fed's institutional independence — helped fuel gold's rally, as investors sought protection against potential policy uncertainty. This pattern suggests that political pressure on the Fed could continue to act as a structural tailwind for bullion.
Outlook
Analysts expect gold to remain range-bound in the near term, with the ₹1,45,000–₹1,49,000 band serving as the key technical corridor. Any renewed hawkish signals from the Fed or a rebound in the Dollar Index could cap further upside, while fresh political pressure on the central bank or a deterioration in US economic data could extend the rally.
Point of View
Even if the Fed has not said so explicitly. More tellingly, the renewed push to pack the Federal Reserve with political loyalists is reactivating the same 'policy uncertainty hedge' that drove gold's multi-year rally. India's domestic market is also absorbing a structural shock from the May 13 import duty hike; the fact that prices have recovered despite that headwind underscores the strength of global demand. The ₹1,45,000–₹1,49,000 range cited by analysts looks conservative if US data continues to soften.
NationPress
4 Jul 2026
Frequently Asked Questions
Why did gold post its first weekly gain since May?
Gold rose approximately 3.1 per cent over the week ending 4 July as softer US jobs data and lower energy prices reduced expectations of further Federal Reserve rate hikes. The probability of a quarter-point Fed rate increase at the next meeting fell to below 20 per cent, boosting bullion demand.
What is the current price of gold in India?
As of Friday, 4 July, the price of 10 grams of 24-carat gold stood at ₹1,46,344, according to IBJA data. MCX gold August futures were last quoted at ₹1,47,365.
How did silver perform alongside gold this week?
MCX silver July futures edged up 0.04 per cent on Friday, with silver futures last quoted at ₹2,37,499 per kg. Silver broadly tracked gold's positive weekly trend.
What is the outlook for gold prices in the near term?
Analysts forecast gold to trade in the ₹1,45,000–₹1,49,000 range, with global cues — particularly US Federal Reserve signals and Dollar Index movements — continuing to drive sentiment. A further softening of US economic data could extend the rally.
How does US political pressure on the Federal Reserve affect gold?
Renewed efforts by President Donald Trump to place his own picks at the Federal Reserve — following a Supreme Court ruling blocking the removal of Governor Lisa Cook — have historically acted as a tailwind for gold. Investors tend to buy bullion as a hedge against potential shifts in monetary policy independence, a pattern that also contributed to gold's rally last year.
