Gold Price Outlook: What to Expect for the Week of September 8, 2025 – Should Investors Buy or Sell?
Gold prices are expected to remain robust in the near future, according to Manav Modi, a Senior Analyst at Motilal Oswal Financial Services Ltd. The recent surge in gold prices, which reached record highs on both Comex and domestic markets, is attributed to increased safe-haven demand amid rising geopolitical tensions and expectations of a potential rate cut by the U.S. Federal Reserve. This optimism is further fueled by disappointing U.S. labor market data, which has led to a significant shift in investor sentiment.
Record Highs Amid Geopolitical Tensions
Last week, gold prices soared to unprecedented levels, driven by a combination of factors including escalating geopolitical tensions and a growing belief that the U.S. Federal Reserve will cut interest rates. Silver also experienced a notable rise, reaching its highest price on Comex since 2011. The surge in gold prices is largely attributed to safe-haven buying as investors seek stability amid uncertainty. The weak U.S. labor market data, particularly a significant slowdown in non-farm payrolls, has further solidified expectations for a rate cut. In August, non-farm payrolls increased by only 22,000, far below the anticipated 75,000, while the unemployment rate climbed to 4.3%, the highest in nearly four years.
Central Bank Buying and ETF Inflows
Central bank purchases have also played a crucial role in supporting gold prices. Notably, China has increased its gold reserves for the tenth consecutive month, while Poland is considering raising its gold reserve target from 20% to 30%. Additionally, exchange-traded fund (ETF) inflows into gold have reached their highest levels since June 2023, indicating strong investor interest. Speculators have also ramped up their net long positions, adding over 20,000 contracts. Despite some profit-taking, gold has remained stable around the key $3,600 mark, positioning itself for its best weekly performance in three months.
Upcoming Inflation Data and Market Reactions
As the market looks ahead, all eyes are on the upcoming U.S. inflation data, specifically the Consumer Price Index (CPI) and Producer Price Index (PPI), which are set to be released just before the Federal Reserve’s critical meeting. These data points will be pivotal in determining whether inflationary pressures are easing enough to justify the anticipated 25-basis-point rate cut. A weaker-than-expected inflation report could further weaken the U.S. dollar, which has already been under pressure, and bolster the ongoing rally in gold prices. Conversely, if inflation data exceeds expectations, it could complicate the Fed’s decision-making process regarding rate cuts and potentially limit gains for gold and silver.
Market Outlook and Investment Strategy
Despite the potential for fluctuations based on upcoming economic data, the overall outlook for gold remains positive. With labor market indicators showing signs of cooling and market participants largely anticipating a rate cut, gold is expected to maintain its support unless inflation data significantly alters this trajectory. Investors are advised to consider a “buy on dips” strategy, with support levels identified between 1,06,000 to 1,04,000 and resistance levels ranging from 1,08,000 to 1,10,000. As the market navigates these developments, gold continues to be viewed as a reliable asset amid uncertainty.
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