Gold's Rally Takes a Breather: Down 2.96% from Record High but Still Up 26% YTD

Gold’s spectacular rally has eased, with prices retreating to $3,329 per ounce as July trading unfolds. The metal has now slipped 2.96% from its all-time high, but it’s still up a remarkable 26% so far in 2025.

Tuesday saw Comex gold close down for a second straight session, marking its sharpest drop since July 8. Despite this breather, bullion’s yearly surge dwarfs most asset classes.

Will gold regain momentum after its two-day slide?

Analysts say the pullback comes as investors lock in profits following the recent record run. Market watchers are split over whether this slip signals a deeper correction or a temporary pause before another push higher.

Global uncertainty, particularly around U.S. tariffs, inflation, and central bank buying, has fueled gold's strength. President Trump’s new round of tariffs, set for August, continues to weigh on risk appetite and support safe-haven inflows.

Did you know?
Gold has historically surged during periods of global economic uncertainty, and in 2025, many central banks have increased their gold reserves to hedge against U.S. dollar volatility.

Are central banks and inflation still key to the gold rally?

A surge in central bank buying, led by countries like Kazakhstan, Turkey, Poland, and Singapore, has added momentum to gold this year. Many monetary authorities now prefer gold to U.S. Treasuries as a hedge against dollar volatility and policy surprises.

At the same time, expectations of a Fed rate hold, following a June inflation spike to 2.7%, have lifted gold’s appeal as an alternative to cash and bonds.

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Gold falls for second session but stays far above 2024 lows

This month’s $3,329 close is still 41% above gold’s 52-week low and up more than a third from last summer’s levels. Even after the pullback, gold remains one of 2025’s best-performing assets.

The recent narrowing of its trading range between $3,320 and $3,375 indicates cautious optimism, as many investors closely monitor U.S. dollar movements and global demand trends.

Tariffs and Fed policies keep investors watching closely

Looking ahead, most analysts expect the gold market to stay sensitive to signals from Washington, whether it’s tariffs, Fed policy shifts, or hints of further central bank stockpiling.

With so many macro factors in play, gold’s next move could come quickly. For now, traders will watch closely to see if the current pause gives way to renewed strength or deeper consolidation as summer unfolds.