It was all eyes on Jerome Powell Wednesday, and traders got exactly what they didn’t want: a firm “not yet” on rate cuts. The Fed held interest rates steady at 4.50% as expected, but Powell’s tone was anything but dovish. Gold responded by puking more than 1.5%, diving below the $3,300 zone, erasing gains and triggering fresh selling momentum.
This wasn’t just about rates staying on pause. It was about Powell dousing September cut hopes with cold water, all while GDP numbers complicated the macro picture further. So now we’ve got a hawkish Fed, shaky data, and a market recalibrating fast. Let’s break it down.
Here’s what you need to know about the move.
1. Powell Shuts the Door on September Easing
🚨 BREAKING: Interest rates remain unchanged at 4.50%
– Inflation still above target
– Fed committed to dual mandate
– Economic growth slowing
– Policy flexible to adjust
– Tariffs added some inflationary pressure
– No decision yet on September meeting— #FinancialPress.com (#@FinancialPress_)
6:52 PM • Jul 30, 2025
The Fed kept rates unchanged at 4.50%, which the market already priced in. What spooked gold bulls was Powell’s press conference. He said the Fed would take it “meeting by meeting,” but poured doubt on the likelihood of a September cut.
His key quote: “Tariff passthrough to prices may be slower than thought.” This means, the Fed still thinks inflation might have legs, and won’t move until it’s sure it’s contained. That hawkish hesitation crushed gold sentiment and fueled a rally in real yields.
2. The Chart Broke But Bulls Are Hanging by a Thread
Gold finally cracked the rising trendline support after weeks of tight coil formation. The break below $3,300 dragged price down to $3,273 intraday, brushing the key 100-day SMA (orange line) around $3,267. That zone between $3,267 and $3,273 is now acting as the new battleground.
While the breakdown confirms near-term bearish momentum, bulls aren’t entirely out of the fight. Price is currently hovering just above the 100-day SMA and horizontal support (green line) around $3,273. If this zone holds, we may see a technical bounce but upside is likely capped unless price reclaims the $3,300–$3,342 confluence.
3. Yields Surge, Dollar Rips, and Gold Bleeds
With the Fed in no rush to cut, yields climbed. The U.S. 10-year Treasury yield rose to 4.36%, while real yields pushed near 1.88%. That’s a double whammy for gold higher opportunity cost and a stronger dollar.
The U.S. Dollar Index (DXY) surged to 99.43, and gold crumbled under pressure, breaking below $3,280 after peaking at $3,334 earlier in the session.
4. Market Odds for a Cut Took a Hit
The CME FedWatch Tool now shows just a 45–50% probability of a September rate cut, down from 60% pre-meeting. Powell’s words and the GDP resilience clipped expectations hard. Traders will be laser-focused on the next key inflation readouts: Core PCE, NFP, and ISM Manufacturing PMI due this week.
Any soft data might revive cut hopes but until then, gold’s upside looks capped, and the dollar remains king.
Here’s the Takeaway:
The Fed stayed put, but Powell’s tone hit like a rate hike. With yields up, the dollar flexing, and September cuts in doubt, gold couldn’t hold the line. Bulls need weak data and fast to turn the tide. Until then, the precious metal is on the defensive. Worth to watch the $3,250 zone. If that cracks, the next leg lower may not be far behind.