Gold and Silver Industry & Investing News

The Federal Reserve is expected to keep interest rates steady, but two Fed governors, Christopher Waller and Michelle Bowman, may dissent and push for cuts amid concerns about a slowing economy. This rare division reflects uncertainty about growth, hiring, and inflation, as well as political pressures and jockeying for the Fed Chair position in 2026. While most officials see steady rates as appropriate, others worry the job market is weakening and want to lower borrowing costs soon.

In its latest Quarterly Gold Report, Invesco analyzes how gold has performed recently alongside other investments. The report highlights the impact of major economic factors like bond yields, the US Dollar, and inflation expectations, providing insights into what drives gold prices and what investors should watch in the coming months.

U.S. economic growth rebounded strongly in the second quarter, growing at a 3.0% annual rate, but this improvement hides some weaknesses. The main boost came from a sharp drop in imports, which reduced the trade deficit, while domestic demand grew at its slowest pace in over two years. Consumer spending rose moderately, but business investment slowed, and homebuilding declined for a second straight quarter. Trade uncertainties and tariffs continue to weigh on the economy.

The Federal Reserve is expected to keep interest rates steady at this week’s meeting, but several interesting developments are unfolding behind the scenes. Two Fed governors are pushing for rate cuts, which could lead to rare dissent in the decision. Meanwhile, Fed Chair Jerome Powell faces pressure from President Trump to lower rates amid debates about tariffs’ impact on inflation. Although no cut is expected now, many see a possible rate reduction in September depending on upcoming economic data.

Gold held steady just above $3,330 per ounce ahead of the Federal Reserve’s interest rate decision. While the Fed is expected to keep rates unchanged, traders are watching closely for any hints from Chair Jerome Powell about possible rate cuts later this year. Lower rates tend to support gold prices. Despite ongoing trade tensions and geopolitical risks fueling gold’s rise this year, recent progress in U.S.-China talks has not boosted market optimism much.

Gold inched up as the dollar weakened slightly before the Federal Reserve’s upcoming decision on interest rates. Market attention is focused on whether the Fed will signal any rate cuts, which could influence gold prices. Progress in trade talks between the U.S. and China, plus deals with other major economies, has improved market confidence. Meanwhile, silver and platinum prices dipped slightly, while palladium edged higher.

Hedge fund manager Ray Dalio recommends that investors hold about 15% of their portfolio in gold or Bitcoin to balance risk and returns. While Dalio personally prefers gold, he acknowledges Bitcoin’s appeal due to its limited supply and use as a form of money. However, he remains cautious about Bitcoin’s technology and privacy issues, and doubts central banks will adopt it as a reserve currency. Dalio also warned about the risks of rising U.S. debt.

Former Bank of Japan Deputy Governor Hiroshi Nakaso says the U.S. dollar will remain the dominant global currency, but “cracks” are appearing in its supremacy. These cracks are encouraging investors to diversify into other currencies. Nakaso also expects the Bank of Japan to resume interest rate hikes once uncertainties from U.S. tariffs ease. He warns that rising inflation risks in Japan require careful monitoring to avoid falling behind the curve.