Powell's Last FOMC Meeting: A Crucial Moment for Gold and Silver
By John Nada·Apr 28, 2026·6 min read
Powell's final FOMC meeting could significantly impact gold and silver prices, hinging on his remarks about rate cuts and geopolitical conditions.
Jerome Powell's upcoming press conference may be a pivotal moment for gold and silver prices, hinging on his language regarding future rate cuts and geopolitical conditions. With a nearly certain hold on rates, the market is focused on how Powell connects potential easing to the Strait of Hormuz and oil prices.
Iran's recent ceasefire proposal adds urgency to Powell's statements. If a credible deal emerges before or during the press conference, it could significantly lower oil prices, easing inflation concerns and opening the door for future rate cuts. This scenario is critical, as Natixis estimates the ongoing war has suppressed gold prices by up to $750 per ounce through inflation and rate holds.
The geopolitical landscape surrounding the Strait of Hormuz is particularly volatile, with Iran's submission of a ceasefire proposal on April 27 acting as a potential catalyst for market movement. The proposal seeks to extend the ceasefire, defer nuclear negotiations, and reopen the Strait of Hormuz in exchange for the US lifting its naval blockade of Iranian ports. Such developments could have a profound impact on oil prices, which in turn would affect inflation metrics and monetary policy decisions by the Federal Reserve.
The structural case for gold and silver remains robust, despite short-term volatility. With U.S. annual debt service exceeding $1 trillion and central banks aggressively buying gold—863 tonnes in 2025 alone—the fundamental drivers of precious metals are unchanged. However, Powell's language could either reinforce or lift the ceiling on gold prices, which currently hinges on geopolitical developments rather than structural economic conditions.
Markets are already pricing in a hold on interest rates, with the CME FedWatch tool indicating a 99.5% probability. Yet, Powell's remarks could move gold by 2-3% within the hour, depending on how he frames the future outlook for energy prices and the geopolitical landscape. A statement linking rate cuts to improvements in the Strait of Hormuz conditions could ignite a rally in gold, pushing prices toward $4,800-$4,850.
Conversely, the worst-case scenario for gold would be a neutral hold statement devoid of any conditions, which could see prices drop below $4,700. This would maintain the current ceiling on precious metals and hinder their potential upside. On the other hand, the silver market is experiencing its unique pressures, with a coverage ratio below the stress threshold and strong physical demand, particularly from industrial users in China.
Silver's dynamics are complicated by its dual nature as both a precious metal and an industrial commodity. While the monetary bid for silver remains strong, a stagflation scenario could weigh on its industrial demand. However, physical demand from retail investors and solar manufacturers remains robust, with March 2026 silver imports in China reaching record levels and running 173% above the 10-year seasonal average. This robust demand from both retail investors and industrial sectors suggests that silver's market outlook may be more resilient than initially perceived.
As Powell approaches his final press conference, the market is poised for significant movements based on the interplay of geopolitical developments and U.S. monetary policy. Investors should remain vigilant, as any signs of easing could trigger a swift shift in market sentiment toward gold and silver. Ultimately, the relationship between oil prices and precious metals will be crucial in determining their trajectories in the near future.
The implications of Powell's statements could extend beyond immediate price movements. If he signals that the rate ceiling is tied to geopolitical issues, it suggests that gold's current price suppression may not be permanent. This could lead to increased investor confidence in gold as a hedge against economic uncertainty, especially given the ongoing pressures from U.S. debt and central bank buying, which have historically supported gold prices.
Furthermore, the transition to a new Fed chair could introduce additional uncertainty. However, markets have reacted positively to the prospect of Kevin Warsh taking the helm, interpreting it as a sign of institutional credibility. This perception might bolster gold's status as a safe haven amid fluctuating economic conditions and geopolitical tensions. Warsh's ascension to the chair could potentially align with a more hawkish or dovish approach depending on his views regarding inflation and interest rates, thereby impacting gold and silver markets.
In the context of Powell's impending departure, it is essential to consider the broader economic landscape. Powell's tenure has been marked by unprecedented challenges, including a pandemic-induced recession, high inflation rates, and geopolitical tensions that have persisted throughout his leadership. His exit signals a potential shift in monetary policy direction, which could have lasting implications for precious metals.
The market dynamics for gold and silver are further complicated by the potential for stagflation—a scenario characterized by rising inflation coupled with stagnant economic growth. If the Federal Reserve's policies do not adequately address inflation, the precious metals market could see increased demand as investors seek safe-haven assets.
Tomorrow’s press conference is more than just a routine update; it’s a critical juncture that could reshape market dynamics for gold and silver. Investors should prepare for potential volatility as they await Powell's decisive words on the future of interest rates and geopolitical factors influencing precious metals. The three main scenarios outlined for Powell's press conference illustrate the potential paths for both metals:
Scenario 1 — Powell signals a conditional easing path, linking it to improvements in oil prices or the Strait of Hormuz. Gold could move toward $4,800-$4,850, with silver following suit as the gold-silver ratio tightens toward 60:1. This scenario represents a clear bullish signal for precious metals.
Scenario 2 — A hold with neutral language sees both metals trading sideways. Markets have already priced in the hold, shifting focus to upcoming economic data releases like the Q1 GDP print. A GDP growth print near the Atlanta Fed’s GDPNow estimate of 1.24% would formally confirm stagflation, potentially increasing safe-haven demand for gold while weighing on silver’s industrial bid.
Scenario 3 — A hawkish hold with no conditions could push gold below $4,700 and silver to test $74, maintaining the current ceiling on precious metals. However, this scenario sets up a sharp rebound once conditions in the Strait of Hormuz improve, opening the window for rate cuts.
The structural case for gold still holds strong regardless of which scenario plays out. Four factors remain unchanged after Powell’s press conference: the U.S. annual debt service exceeding $1 trillion rivals the entire defense budget, the projected U.S. fiscal deficit of $1.9 trillion for FY2026, continued aggressive central bank buying of gold, and COMEX silver experiencing prolonged coverage-ratio stress. These factors indicate that the underlying support for gold remains intact, irrespective of temporary price fluctuations.
Gold has historically shown resilience, running from $2,600 to $5,589 in just fourteen months, driven by debt concerns, central bank purchases, and fiat currency erosion. The current price ceiling for gold is primarily linked to oil prices, which depend on geopolitical stability in the Strait of Hormuz. As such, the market should remain alert to Powell's language at the press conference, as it will provide insights into how close we are to lifting that ceiling and facilitating a potential rally in precious metals.