Gold Stays Resilient as Investors Debate Next Move Amid Mounting Debt Worries
Saturday, July 19th 2025
Gold’s recent performance has left Wall Street divided, while Main Street investors grow increasingly bullish as concerns over ballooning U.S. debt and economic policy persist.
Despite strong economic data and renewed risk appetite boosting equities, geopolitical risks and sovereign debt fears helped gold claw back above $3,300 this week. After opening near $3,271 per ounce, the yellow metal weathered a dip below $3,250 before rallying to close the week around $3,326, up nearly 1.8% for the week despite a slight daily pullback.
Tug of War Between Bulls and Bears
Throughout the week, gold fluctuated within a narrow range, briefly touching highs of $3,365 as traders weighed strong jobs numbers against the broader macro risks. The price action mirrored the broader sentiment split: institutional analysts remain cautious, while retail investors lean bullish.
“The persistent trend of dollar weakness is a key tailwind for gold,” said Adam Button of Forexlive.com. “Even when the greenback rallied briefly on payrolls data, it quickly reversed, showing that trend still dominates.”
Rich Checkan of Asset Strategies International warned of rising U.S. debt levels, calling gold “the solution to overspending,” while others, like Adrian Day of Adrian Day Asset Management, see potential short-term pressure from a mix of positive trade developments and speculation around Fed rate cuts.
The Fed’s Dilemma Fuels Uncertainty
The Federal Reserve remains at the heart of the debate. While inflation has moderated, the economy is still robust, leaving policymakers reluctant to cut rates aggressively.
“The Fed is stuck,” said Colin Cieszynski of SIA Wealth Management. “Cutting into a strong economy risks stoking inflation again, especially with tariffs looming. But markets have already priced in several rate cuts for 2025.”
Cieszynski also pointed to the collapse of the dollar as an overlooked factor propping up gold, noting how major currencies like the euro, pound, and yuan have all gained double digits against the dollar over the past six months.
Debt Concerns Dominate the Bullish Case
At the core of the bullish outlook lies the U.S. fiscal situation. With national debt surpassing $37 trillion and another multi-trillion-dollar budget on the table, investors are wary of where this leads.
“The math doesn’t work,” Checkan warned. “At some point, investors will rotate into hard assets like gold.”
Sean Lusk of Walsh Trading, however, remains skeptical of cutting rates while the economy is still growing. “The economy isn’t in trouble, stocks are at record highs, inflation has cooled,” he said. “Cutting now could reignite the very inflation they’ve fought to control.”
Technical Views: Sideways for Now, But Risks Tilt Higher
Technically, gold appears to be consolidating, trading near the midpoint of its broader range between $3,250 and $3,540. Several analysts expect more sideways, choppy price action until a new catalyst emerges.
“Gold needs a fresh spark to break out of its range,” said Jim Wyckoff.
Marc Chandler of Bannockburn Global Forex sees the risk of a short-term pullback to $3,250, while Lusk suggested a healthy retracement toward $3,225–$3,170 is possible before another push higher later in the year.
Still, most analysts agree that long-term fundamentals—growing debt, geopolitical uncertainty, and a weaker dollar—will continue to support gold through 2025 and beyond.
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