World gold prices recovered in the trading session on July 9 as the USD weakened, helping the precious metal rebound from its lowest level in nearly a week. However, short-term prospects are still under pressure as tensions between the US and Iran increase concerns about inflation, thereby strengthening expectations that the US Federal Reserve (Fed) will maintain tight monetary policy for a longer time.
As of 4:06 PM Vietnam time, spot gold prices increased by 0.87% to 4,108.17 USD/ounce, while August gold futures contracts increased by 0.82% to 4,116.00 USD/ounce.
The USD depreciating by about 0.1% in the session supported gold prices as it made the precious metal more attractive to investors holding other currencies.
However, the market remained cautious after the minutes of the Fed's June monetary policy meeting showed that policymakers continued to consider inflation a major risk to the economy. According to the minutes, although all members of the Federal Open Market Committee (FOMC) agreed to keep interest rates unchanged, some members suggested that it may be necessary to continue raising interest rates if inflationary pressure persists.
According to the CME FedWatch tool, the market currently values about 65% of the possibility of the Fed raising interest rates at the September meeting.
Besides monetary policy, investors continue to monitor developments in the Middle East. The US military is conducting more airstrikes to ensure maritime operations through the Strait of Hormuz, while President Donald Trump said Iranian officials have contacted Washington to seek a peace agreement.
In the context of volatile short-term prospects, Bank of America (BofA) has just lowered its 2026 average gold price forecast by 14% to 4,360 USD/ounce, citing the Fed's pursuit of a tougher stance on inflation control.
However, BofA still maintains a positive view on the long-term outlook for gold and continues to forecast prices may reach 5,000 USD/ounce after the Fed's monetary policy tightening cycle ends.
This view is also shared by many major financial institutions. According to the latest forecasts, JPMorgan, Morgan Stanley, HSBC, Standard Chartered and Commerzbank all forecast that the average gold price in 2026 will fluctuate in the range of 4,488–4,900 USD/ounce. Meanwhile, Deutsche Bank and ANZ gave forecasts above 5,500 USD/ounce, while Goldman Sachs, Citi Research, UBS, Societe Generale and Wells Fargo Investment Institute continue to maintain higher price targets as the Fed enters a policy easing cycle.
Forecasts show that, although short-term prospects are still under pressure from high interest rates and inflation risks, most international financial institutions still assess that the long-term upward trend of gold prices has not changed.
