Global Interest Rate Hike Cycle Main Concern For Gold Prices - MGA

KUALA LUMPUR, Sept 18 (Bernama) – The Malaysia Gold Association (MGA) stated that the ongoing interest rate hike cycle in major economies is anticipated to be the primary factor impacting gold prices in the future.

Its president, Datuk Seri Louis Ng, said further interest rate increases could potentially dampen the precious metal’s price.

"The upcycle could continue with another two or three rate increases, potentially pushing interest rates to five per cent or 5.25 per cent, before they eventually settle down. 

"We could then expect a downcycle, during which gold prices would move higher, while an upcycle in interest rates would dampen and suppress gold prices," he told reporters after the launch of the Malaysian Gold Festival (MGF) 2026, here today.

Yesterday, the US Federal Reserve (Fed) raised its benchmark interest rate by 25 basis points to a target range of 3.75 per cent to 4.00 per cent, marking its first increase in more than three years and could be increased further in a bid to slow rising prices.

On geopolitical tensions, Ng said ongoing conflicts in West Asia, including the war in Ukraine, had largely been factored into current gold prices.

He noted that the conflict between the US and Iran continues, and it also affects the situation in Ukraine and Russia.

“The war has been sporadic, with periods of escalation and calm, and there is still no agreed-upon truce or ceasefire. However, we have already taken this into account when considering the gold price.

"Therefore, gold is set to trade in the range between US$4,000 and US$5,000 per troy ounce for the next two years," he said.

MGF 2026 brings together approximately 70 local and international exhibitors across the gold and jewellery value chain for three days of trade, business networking, knowledge exchange and consumer engagement.

-- BERNAMA