Gold reached a new peak on Thursday following indications from the Federal Reserve of potential interest rate reductions, enhancing the attractiveness of bullion amidst global uncertainties. The spot gold price slightly increased to $3,049.89 per ounce, hitting an all-time high of $3,055.96 previously. Meanwhile, U.S. gold futures rose to $3,058.40.

Factors such as market instability, geopolitical tensions, a weaker U.S. dollar, and expectations of future interest rate cuts are driving the surge in gold prices, according to Dick Poon from Heraeus Metals Hong Kong Ltd. The Federal Reserve decided to maintain its benchmark interest rate between 4.25% and 4.50%, with estimates of two quarter-point rate cuts by the end of 2025.

President Trump's trade policies, particularly imposing tariffs, have impacted the U.S. economy, leading to slower growth and temporary inflation increases, as stated by Federal Reserve Chair Jerome Powell. These tariffs are believed to contribute to inflation and hinder economic growth.

Various factors like trade uncertainties, potential rate cuts, and geopolitical tensions in the Middle East are fueling the ongoing rally in gold, resulting in numerous record highs being achieved in 2025. Gold is considered a safe haven amid global uncertainties and performs well in a low-interest rate environment.

ABC Refinery's Nicholas Frappell noted the possibility of a correction in the gold market following a strong Q1 performance, though corrections have been brief and well supported. The resistance level for gold may be around $3,090-$3,100.

Additionally, spot silver remained stable at $33.81 per ounce, platinum saw a slight increase to $994.05, while palladium edged up to $957.42.

The information was reported by Anjana Anil in Bengaluru and edited by Alan Barona and Varun H K.