Gold breaks $4,000 as traders eye Fed rate cuts and trade developments

Gold spot prices have surged above the psychological $4,000 mark, gaining momentum as markets increasingly price in Federal Reserve rate cuts for 2025. The precious metal's strength reflects growing expectations that the Fed will pivot to a more accommodative stance amid signs of economic moderation. Currency markets are responding accordingly, with the US Dollar Index showing weakness against major counterparts. EUR/USD has found support above 1.0800, while AUD/USD benefits from improved risk sentiment and potential trade de-escalation between major economies. The correlation between gold and currency movements remains strong, with dollar weakness providing additional tailwinds for the yellow metal. Technical indicators suggest further upside potential for gold if it maintains above $4,000, which could pressure the greenback further. Traders should monitor upcoming Fed communications and any developments in international trade negotiations, as these factors will likely drive both precious metal and forex market direction in the near term.