This week, 15 Wall Street analysts participated in a Kitco News survey, expressing more balanced opinions after the Federal Reserve (Fed) decided to lower interest rates. 6 analysts anticipate a rise in gold prices next week, while 3 predict a decline. The remaining 6 analysts believe the precious metal will hold steady.

Meanwhile, 285 votes were cast in Kitco's online poll of Main Street investors. 58% believe gold prices will climb next week, while 24% anticipate the opposite. 18% of investors agree on a scenario of sideways consolidation.

Colin Cieszynski, chief strategist at SIA Wealth Management, is neutral on gold prices for the upcoming week. He believes the precious metal has experienced significant recent growth and requires a period of consolidation. "The interest rate decision has been made, and as the market approaches the end of the quarter with a slowdown in news flow, gold needs time to consolidate," he added.

Philippe Gijsels, chief strategist at BNP Paribas Fortis, also maintains a neutral stance on market developments. He suggests that prices might fluctuate around 3,600 USD per ounce but will remain well-supported, as he anticipates another interest rate cut soon.

Similarly, Adrian Day, president of Adrian Day Asset Management, sees no reason for gold to decline. However, he also acknowledges the difficulty of price increases due to weakening technical indicators.

Day emphasizes that the gold market has become much broader and more diverse. Consequently, the Fed's interest rate policy is not the sole driver of prices. He notes that many investors are not currently focused on the US economy and will therefore base their trades on factors entirely independent of the Fed's actions.

"I don't think those in Beijing and Shanghai who are buying gold as savings are really looking at what the Fed is doing," he exemplified.

Day hypothesizes that even if the Fed postpones the next interest rate cut, the gold market will reprice itself accordingly. Those anticipating gold reaching 4,000 USD per ounce by the end of the year should not solely rely on predicting the Fed's intentions.

An employee places 99.99% pure gold bars in the workroom at the Novosibirsk precious metals refining and production plant in Russia, 9/2023. Photo: Reuters

However, some experts remain optimistic about gold prices and believe in the influence of US interest rates on this asset. James Stanley, senior market strategist at Forex, believes gold prices will continue to rise, reflecting the ongoing impact of the interest rate cut. He views any price drop as an opportunity for speculators.

According to Rich Checkan, President and COO of Asset Strategies International, the Fed has met market expectations. Combined with tensions in Ukraine, Poland, Gaza, and the Caribbean, both gold and silver are expected to surge after the recent brief profit-taking period.

After a week focused on central bank actions, the market will see a series of inflation, industrial, and housing indicators next week that could impact gold. Looking further ahead, investors are beginning to consider potential candidates for the Fed Chair position, as Jerome Powell's term ends in 5/2026.

Tieu Gu (according to Kitco)