Gold will likely be under pressure in Q4 on hawkish US Fed policy

Gold prices have likely reached a peak and may face downward pressure in the fourth quarter of 2025 due to a combination of factors, according to analysts. The US Federal Reserve's decision to raise interest rates for the first time in three years at its September meeting has negatively impacted gold's value. While gold briefly dipped below the $4,400/ounce mark, it has maintained support at the $4,000/ounce level.

Research agency BMI estimates that in the next 2-3 quarters, hawkish policies from developed market central banks, a strong US dollar, and elevated US real rates could hinder gold's near-term upside. Similarly, Australia's Office of the Chief Economist predicts a decline in gold demand in 2026 as investors take profits and higher dollar bond yields reduce its appeal.

ING Think warns that gold could remain vulnerable if policymakers indicate rates will remain high for an extended period. Chinese commodity data group SunSirs anticipates that gold prices will continue to fluctuate within a range as markets adjust to the expectation of sustained higher rates to combat inflation. Gold prices have eased as investors brace for central banks to maintain elevated rates to curb inflation, even as China's gold imports surpassed full-year 2025 levels in August.