Gold Awaits Warsh

Gold Prices Hold Steady Ahead of Warsh’s Jackson Hole Speech

Gold prices were little changed on Friday as investors closely awaited remarks from Federal Reserve Chair Kevin Warsh at the Jackson Hole Symposium, seeking fresh clues on the future path of U.S. interest rates.

Spot gold traded flat at $4,600.19 per ounce as of 13:50 WIB, while U.S. gold futures slipped 0.3% to $4,651.41 per ounce.

The precious metal recently climbed to a three-month high near $4,700 per ounce earlier this week, supported by concerns over U.S. fiscal policy and Treasury measures aimed at strengthening demand for long-term government bonds.

Despite the strong rally, gold is on track for a modest weekly decline after posting gains for three consecutive weeks.

Investors Focus on Jackson Hole and Fed Rate Outlook

Market participants remain cautious ahead of Warsh’s highly anticipated speech scheduled for Friday evening. His first major address as Federal Reserve Chair at Jackson Hole is expected to provide important insights into inflation trends and the central bank’s monetary policy strategy.

Recent economic data have complicated expectations for interest-rate cuts. The latest Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation gauge, rose 3.7% year-over-year in July, fueling speculation that policymakers could still raise rates later this year.

According to the CME FedWatch Tool, markets currently price in a 34% probability of a rate hike in September and a 74% chance of an increase by December.

Higher interest rates generally weigh on gold prices because the non-yielding asset becomes less attractive compared with interest-bearing investments such as bonds and savings instruments.

Gold Supported by Weaker Dollar and Lower Bond Yields

While gold struggled to extend its recent gains on Friday, the broader market backdrop remains supportive. The metal has benefited from declining Treasury yields and a softer U.S. dollar, both of which reduce the opportunity cost of holding bullion and make it more affordable for overseas buyers.

Even with the latest pullback, gold has surged more than 13% in August, reflecting strong investor demand amid economic uncertainty and shifting expectations for Federal Reserve policy.

Silver, Platinum, and Copper Advance

Among other precious metals, silver prices rose 1.3% to $70.11 per ounce, while platinum gained 1.8% to $1,882.60 per ounce.

In industrial metals, benchmark London Metal Exchange (LME) copper futures edged up 0.4% to $14,338.15 per metric ton, while U.S. copper futures added 0.2% to $6.68 per pound, supported by steady demand expectations and broader commodity market strength.

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Gold Near $4,600

Gold Holds Near $4,600 Ahead of Warsh Speech

Gold prices rose on Thursday, moving back toward the $4,650 per ounce level as investors assessed the Federal Reserve’s approach to persistent inflation ahead of Fed Chair Kevin Warsh’s highly anticipated speech at the Jackson Hole symposium.

At 08:45, XAU/USD was up 0.7% at $4,625.83 per ounce, while Gold Futures gained 0.6% to $4,680.50. XAG/USD climbed 1.9% to $69.41 per ounce, while XPT/USD advanced 1% to $1,854.30. The US Dollar Index was little changed at 99.12.

Sticky Inflation Supports the Dollar and Treasury Yields

Gold declined 1.4% on Wednesday, ending a five-session winning streak after the latest US inflation data showed that price pressures remain well above the Federal Reserve’s 2% target.

The data pushed the US dollar higher and lifted US Treasury yields, two developments that typically weigh on gold because the precious metal does not generate interest and is priced in US dollars.

The Personal Consumption Expenditures (PCE) Price Index rose 3.7% year over year in July, unchanged from June and slightly above economists’ forecast of 3.6%.

Markets responded by modestly increasing expectations for a September rate hike. The probability of at least a 25-basis-point increase has risen to around 40%, compared with approximately 36% before the inflation data was released. Traders also continue to anticipate higher interest rates by the end of the year.

ANZ analysts said the downside for gold could remain limited as ongoing debasement trade continues to attract buyers.

The latest inflation figures also came alongside signs of resilience in the broader US economy. Second-quarter GDP growth remained unchanged at 1.5%, personal income increased 0.4% in July, while consumer spending was flat.

Warsh Speech Becomes the Next Key Test

Attention now turns to Warsh’s Jackson Hole speech on Friday, his first major address as Federal Reserve Chair. Investors will be watching closely for clues about how he plans to respond to inflation that has remained above the Fed’s 2% target for an extended period.

Warsh faces pressure to provide greater clarity after moving away from traditional forward guidance since taking office. Investors also want him to address the interaction between monetary policy and the bond market, particularly after the US Treasury doubled its planned purchases of longer-dated government debt.

ANZ noted that recent Treasury measures and growing concerns over fiscal policy have helped sustain the debasement trade. In simple terms, investors are buying gold as a hedge against the risk that persistent deficits, heavy borrowing, and policies designed to contain long-term yields could weaken the purchasing power of the US dollar.

This theme has provided a counterbalance to the interest-rate pressures created by persistent inflation. Gold remains around 14% higher this month despite Wednesday’s pullback, following renewed momentum from Treasury intervention.

The precious metal also remains above its 200-day moving average, a widely watched indicator of long-term market momentum.

Meanwhile, gold-backed ETFs have recorded strong inflows during the latest rally, while continued central-bank demand and concerns over the sustainability of US fiscal policy are supporting the long-term outlook for gold.

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Gold Eyes Breakout

Gold Holds Above $4,650 as Traders Await US PCE Data for Fed Rate Clues

Gold prices (XAU/USD) extended their two-way trading pattern for a second consecutive session on Wednesday, holding above the $4,650 level during Asian trading hours. The precious metal remains close to its highest level since May 14 as investors await the release of the U.S. Personal Consumption Expenditures (PCE) Price Index, a key inflation gauge that could provide fresh insight into the Federal Reserve’s interest rate outlook.

Gold Rally Faces Resistance Near Key Technical Levels

The recent breakout above the important $4,500 psychological level marked a significant bullish development for gold. This area coincides with the 200-day Simple Moving Average (SMA) and the 38.2% Fibonacci retracement of the March-to-June decline, making it a critical support zone for buyers.

However, the subsequent rally has struggled to gain acceptance above the 50% Fibonacci retracement level, suggesting that traders should remain cautious before anticipating a sustained move higher.

Technical indicators present a mixed but generally constructive picture. The Relative Strength Index (RSI-14) is hovering near 72, signaling overbought conditions and indicating that bullish momentum may be vulnerable to a period of consolidation. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator remains firmly in positive territory, reinforcing the broader bullish bias despite stretched momentum.

For now, gold bulls appear reluctant to make aggressive bets until prices decisively break above the $4,700 resistance level.

Key Gold Price Levels to Watch

A sustained move above $4,700 could open the door toward the 61.8% Fibonacci retracement level at $4,856, followed by the 78.6% retracement near $5,104. Beyond that, attention could shift to the cycle high around $5,421.

On the downside, immediate support is located near the 200-day SMA at $4,522 and the 38.2% Fibonacci retracement at $4,508. A deeper pullback could expose the 23.6% retracement level at $4,292, followed by a major structural support zone around $3,944.

Fed Expectations and Treasury Buybacks Support Gold

Market expectations have increasingly shifted toward a pause in interest rates at the Federal Open Market Committee (FOMC) meeting scheduled for September 15–16. Cooling inflation pressures and a softer labor market have reduced the urgency for further monetary tightening.

At the same time, the U.S. Treasury’s bond buyback strategy has contributed to a further decline in Treasury yields. Senior officials have indicated that the Treasury could use part of its nearly $1 trillion General Account balance to finance recently announced plans aimed at increasing purchases of longer-dated government bonds.

Lower Treasury yields generally benefit gold by reducing the opportunity cost of holding non-yielding assets, making bullion more attractive to investors.

Middle East Developments Weigh on Oil and Support Gold

Gold has also received support from falling crude oil prices as geopolitical tensions in the Middle East show signs of easing.

Oil prices dropped to their lowest level in nearly two weeks after Iran announced that it had resumed discussions with Oman regarding commercial shipping through the Strait of Hormuz. Both countries reportedly explored the possibility of establishing a temporary joint navigation corridor through the strategically important waterway.

In addition, the United States has reportedly offered sanctions relief and an end to maritime restrictions in exchange for the reopening of the Strait and a halt to attacks by Iran-backed regional proxies.

These developments have revived hopes for a diplomatic solution to the U.S.-Iran conflict, helping to reduce inflation concerns through lower energy prices. Softer inflation expectations have placed additional downward pressure on U.S. bond yields, limiting demand for the U.S. dollar and providing further support for gold prices.

Gold Outlook Remains Bullish but $4,700 Is Key

Despite strong bullish momentum, traders remain cautious ahead of the U.S. PCE inflation report and continue to watch the critical $4,700 resistance level. A confirmed breakout above this barrier could trigger a fresh wave of buying and strengthen the case for further gains in gold prices.

Until then, investors are likely to remain focused on incoming economic data, Federal Reserve policy expectations, Treasury market developments, and geopolitical events that continue to shape the outlook for both the U.S. dollar and precious metals.

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