Gold Prices Consolidate in Narrow Range
During Wednesday's Asian trading session on July 29, spot gold fluctuated within a narrow range around $4,035.13 per ounce, having previously touched an intraday low of $4,010.29 per ounce. Market sentiment remained cautious as investors focused on the upcoming Federal Reserve FOMC rate decision scheduled for early July 30 Beijing time, as well as the press conference led by Fed Chairman Kevin Warsh.
Concurrently, geopolitical dynamics evolved further as joint US-Saudi airstrikes targeted locations within Iraq, while Oman introduced a new proposal for joint regional management of maritime straits.
Joint US-Saudi Airstrikes Target Locations in Iraq
On the geopolitical front, the United States and Saudi Arabia executed joint strikes on July 29 against pro-Iranian armed targets in eastern Iraq, holding them accountable for recent drone attacks on major Saudi energy infrastructure. Iraqi entities reported casualties and facility damage, while Iranian defense officials characterized attributing the attacks to Tehran as a grave miscalculation.
Simultaneously, the Islamic Revolutionary Guard Corps announced the interception and detention of three commercial cargo vessels for safety violations within regional waters, alongside launching multiple ballistic missiles toward a US military base in Jordan.
To mitigate maritime transit friction through the strait, Oman submitted a Gulf-backed joint management proposal to Iran modeled after Malacca Strait protocols, suggesting voluntary service fees paid by transiting vessels to fund navigation and security operations. However, US officials stated they do not support transit fees, reiterating that unhindered freedom of navigation must be preserved.
Focus Turns to Upcoming Fed July Monetary Policy Resolution
Financial markets remain in suspense awaiting the Federal Reserve's July FOMC decision. Latest CME FedWatch data indicates market participants price a 70.6% probability of the Fed holding benchmark rates unchanged, alongside a 29.4% chance of a 25-basis-point hike, while implied expectations for a September rate hike have risen to 77%.
Fed Chairman Kevin Warsh's post-decision press commentary represents the primary focal point for market direction. Additionally, the Bank of England and the Bank of Japan are scheduled to release monetary policy decisions later this week, with consensus anticipating benchmark rates to remain steady for both central banks.
Central Bank Gold Accumulation Continues to Provide Long-Term Support
Following Q2 market pullbacks, a recent Reuters survey of 29 analysts and traders revealed that institutions lowered average annual gold price forecasts for the first time since late 2023. The median forecast for gold in 2026 stands at $4,509 per ounce, down from $4,916 three months ago, while the 2027 average forecast was adjusted to $4,610 per ounce.
Commerzbank revised its year-end gold target down to $4,500 per ounce. Despite short-term price target adjustments, analysts at Standard Chartered and multiple institutions emphasize that structural support factors—including persistent central bank gold accumulation, expanding sovereign debt, and ongoing fiat currency credit concerns—remain firmly intact.