Gold prices edged lower on Tuesday as traders booked profits amid low holiday trading volume. Most major markets closed for Christmas on the 25th, so there was little action. After touching a new record of nearly $4,526, gold dropped back to about $4,470. Still, it’s up almost 3% this week. The trend’s strong—just a little pause for the holidays.
Profit-Taking Hits After Gold’s Wild Run
Gold’s performance in 2025? It’s been off the charts, to be honest. Prices have now surged more than 70 percent this year — the largest increase since 1979. Investors have rushed in, looking for a safe place to hide from a restless world, growing geopolitical dangers, and an unpredictable economy.
Fed Eases Up, Dollar Slips—Gold Keeps Climbing
Gold’s rally isn’t just about nerves. The Federal Reserve has already cut rates by 75 basis points in 2025, making it a lot cheaper to hang onto non-yielding assets like gold. On top of that, the US dollar has lost some strength, adding more fuel to gold’s fire. Markets are already eyeing two more rate cuts next year, though, for now, most expect the Fed to hit pause in January. The CME FedWatch Tool puts the odds of another cut next month at just 13%.
Mixed Data, But Bulls Aren’t Backing Down
Recent US numbers tell a messy story. Fewer people filed for jobless claims—down to 214,000—but consumer confidence slid to 89.1 in December. The economy’s still got some muscle, though: third-quarter GDP grew 4.3%, beating forecasts. Sure, there are hints of short-term consolidation, with technical signals like bearish RSI divergence popping up. But with global tensions simmering and rate cuts likely, gold’s bigger uptrend looks solid. This rally probably isn’t over—it could stretch well into 2026.
