"Sticky Inflation" Caps Gold Gains as Rate Cut Sentiment Recedes

Market Overview

Fed Chair Jerome Powell hinted at rising inflationary pressures, dampening optimism sparked by Trump‘s comments suggesting Iran might be open to renewed negotiations. Following Powell’s remarks, U.S. equities turned lower mid-session, ending mixed. Treasury yields briefly dipped but finished with limited losses due to the Feds hawkish tone. Gold retreated more than 1% from its intraday high, while platinum surged to an 11-year high. Oil prices wavered, sliding during the session as Trump stated he “does not want U.S. involvement in the Middle East conflict.” Overall, the market remains highly sensitive to both policy signals and geopolitical developments.

Hot Topics to Watch

● Fed Holds Steady with Cautious Outlook

The Fed lowered its GDP growth forecast to 1.4% for 2025, and revised upward its unemployment and PCE inflation projections for this year and beyond. The so-called “Fed whisperer” noted the central bank is keeping the door open for rate cuts in the second half of the year, but would require signs of labor market weakness or evidence that tariff-induced inflation remains mild. The latest dot plot reveals notable divisions within the Fed on the future rate path.

● Trump on Iran: Negotiation Window May Have Passed

President Trump commented on the Iran situation, saying the current landscape has changed significantly from a week ago. While military action is on the table, it‘s not guaranteed. He claimed Iran wants to negotiate now but questioned why they didn’t do so earlier. Trump left the door open for diplomatic resolution and denied reports that the U.S. had pledged additional support to Israel. According to China Central Television (CCTV), Trump emphasized that the U.S. is not seeking a ceasefire but insists on “no nuclear weapons for Iran,” adding that “a deal is still possible.”

Key Focus (GMT+8)

19:00 UK – Bank of England Interest Rate Decision (June 19)