Powell Destroys Market Fantasy! Gold Soars to New Highs. How Much Higher Can It Go?

TradingKey - Powell's speech sent gold prices soaring to new highs. Goldman Sachs predicts gold could reach $3,700 by year-end or even higher. 

On Thursday, following Powell's remarks, spot gold (XAUUSD) peaked at $3,357 per ounce before settling at $3,330 per ounce.

Gold Price Chart, Source: TradingView.

In his speech at the Chicago Economic Club, Powell warned that potential tariffs could lead to rising inflation and slower economic growth. However, he made it clear that the Fed would not intervene to support the markets. 

 "The market faces a lot of uncertainty, but it is digesting what’s happening. It’s orderly and functioning as expected," Powell said

Previously, many  had anticipated that the Fed would step in  to mitigate the economic impact of Trump  tariff policies. Powell's comments dashed those hopes, increasing demand for safe-haven assets and pushing gold prices higher.

Gold has experienced a remarkable rally  this year, gaining nearly 28% to date. Despite the surge, Goldman Sachs has raised its gold price forecasts, projecting it could reach $3,700 by the end of 2025—and possibly rise as high as$4,500.