#SpotGoldBreaksBelow400

The Fed Remains Hawkish, Gold Prices Risk Further Correction

Global gold prices continue their weakening trend amid increasing market expectations for high interest rate policies from the US central bank, the Fed.

This condition reduces investor interest in gold as it is considered less attractive compared to US dollar-based assets and US government bonds.

Quoting Trading Economics on Thursday (6/25/2026) at 4:50 PM WIB, gold prices in the spot market stood at US$ 3,986.16 per troy ounce, weakening by 5.22% over the past week and 11.53% over the past month.

Spot gold prices can be considered quite cheap now, given that in late January 2026 they soared to touch US$ 5,500 per troy ounce.

The President Director of Dupoin Futures Indonesia, Gunawan Herman, stated that the current decline in gold prices is triggered by increasing expectations of a Fed rate hike, supported by several solid US economic data. Currently, the Fed's interest rate stands at 3.50% to 3.75%.

According to him, labor data, inflation, and US economic conditions throughout June show quite positive developments, strengthening market confidence that the Fed still has room to maintain a hawkish monetary policy.

"This condition makes gold assets not yet a target for retail investors because they do not provide attractive returns like the dollar and US bonds," said Gunawan when contacted by Kontan on Thursday (6/25/2026).

From a technical perspective, Gunawan sees that pressure on gold prices still has the potential to continue in the short term. Gunawan noted on the weekly time frame chart that gold prices still show potential for weakening towards the US$ 3,900 per troy ounce level.

Therefore, he believes investors do not need to rush into large-scale accumulation and should wait for the next market sentiment developments.

"We need to see the future outlook first, whether there is positive or negative sentiment at that level. Additional catalysts from macroeconomic conditions are needed to start accumulation," he continued.

Nevertheless, Gunawan assesses that gold still retains its appeal as a safe haven asset, especially in the long term. However, for the remainder of 2026, the prospects for gold price movements will still be heavily influenced by the direction of Fed rate policy.

According to him, if expectations of a US rate hike persist, gold prices could move lower. "With the projection that the Fed rate hike could still occur, we will start to see the US$ 3,900 to US$ 3,800 level as a buying level," he revealed.

For the end of 2026, Gunawan highlights several important technical levels that market participants need to watch. He provides the prospect that the support area for spot gold prices could be in the range of US$ 3,800 to US$ 3,600 per troy ounce.