The 2026 World Cup has sparked a US economic recovery; gold prices are slowing down, awaiting new factors to determine their direction.
Hua Seng Heng indicates that support from major sporting events may put short-term pressure on gold, but the Fed, inflation, and geopolitical conflicts remain the decisive variables. Global gold prices have faced continued upward pressure recently, falling to a low of around $4,020 per ounce and remaining below the 200-day moving average (SMA200) since early June. This has led to a more cautious investment climate, causing several analysts to suggest that gold prices could fall below $4,000 if macroeconomic factors do not support a recovery.
However, amidst these pressures, the market has received a new and interesting factor: the recovery of the US economy, which may receive further boost from major global sporting events such as the FIFA World Cup 2026.
The FIFA World Cup, held from June 11 to July 19, 2026, was co-hosted by the United States, Canada, and Mexico. This marked the first time in history that the number of participating teams increased to 48, and the number of matches increased to 104. This made it the largest and most valuable event ever held, leading many to anticipate a significant boost to economic activity in North America, particularly in the host city and the US service sector, including tourism, hotels, restaurants, transportation, events, and the entertainment industry.
A study by OpenEconomics (OE), published through FIFA and the World Trade Organization (WTO), estimates that the 2026 FIFA World Cup could add approximately $17,200 billion to the U.S.'s GDP and support around 185,000 jobs through spending related to tourism, travel, and services. While this represents a relatively small proportion of the U.S. economy, the positive impact is likely to be concentrated in the host city and related businesses, particularly in the service sector.
The recovery in the service sector and labor market could strengthen the image of the U.S. economy in the short term, influencing expectations regarding the Federal Reserve's monetary policy and global investment trends. However, the World Cup alone may not be enough to determine the direction of gold prices in the coming period, as markets continue to prioritize other crucial macroeconomic factors.
Currently, investors are still focusing on three main issues:
- Geopolitical conflicts, particularly the US-Iran situation.
- The Federal Reserve's monetary policy outlook is under pressure from persistently high inflation.
- The direction of the US dollar continues to be supported by a strong economy.
These factors all directly impact gold prices, as a recovering economy tends to keep US bond yields and the dollar strong, increasing the opportunity cost of holding gold and reducing the attractiveness of safe-haven assets in the short term. While the 2026 World Cup is another factor boosting US economic activity and employment, it is not the primary driver of gold prices.
"The recovery of the US economy could boost the dollar and bond yields in the short term, putting downward pressure on gold prices. However, the main factors the market is focusing on remain the Federal Reserve's monetary policy outlook, geopolitical risks, and the direction of global inflation."
Hua Seng Heng assesses that the current gold price movement is still in a state of "losing momentum" after breaking below the 200-day moving average, reflecting short-term technical pressure. However, this weakness in gold prices may not yet be considered a complete transition into a downtrend, as long-term fundamental factors such as geopolitical risks, global sovereign debt levels, and continued gold purchases by several central banks remain key supports for gold as a safe-haven asset.
Going forward, investors should closely monitor inflation trends and U.S. economic policy, as well as geopolitical developments, as these factors continue to have a greater influence on gold prices than any potential economic boost from the global sporting event.
Ultimately, the 2026 World Cup may only provide a short-term boost to the US economy, but for the gold market, the real game remains the battle between inflation, interest rates, and global economic uncertainty, which will determine investment direction for the rest of the year more than any cheers from the sidelines.
refer : inside.fifa.com , www.worldometers.info
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