Gold Prices Slide on Fed Caution and Tariff Escalation: What's Next for Investors?

Gold prices declined over 1% on Tuesday as the Fed’s cautious tone tempered investor enthusiasm. Trade tensions escalated as U.S. President Trump confirmed new tariffs taking effect on 1 August, impacting various imports. Market expectations for a July rate cut by the Fed decreased following a strong U.S. jobs report, suggesting a more cautious approach. Gold stabilised around $1,300 as investors await the release of June’s FOMC Meeting Minutes for further insight.

The euro rose slightly as the EU appears to have secured exemptions from the U.S. trade tariffs. Trump announced new tariffs on 14 countries, including 50% on copper imports and potential 200% on pharmaceuticals. EUR/USD fell as investors await the FOMC Meeting Minutes for clarity on the Fed’s monetary policy trajectory.

The Australian dollar gained after the RBA left interest rates unchanged at 3.85%, diverging from expectations of a cut. The decision reflected a cautious stance amid global and domestic economic uncertainties. Trump’s new tariffs and the RBA’s sensitivity to global risks highlight the need for ongoing monitoring. AUD held steady as investors await the FOMC Meeting Minutes for further guidance on monetary policy.

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