Gold Corrects Lower Despite Bullish Bias Intact
Gold prices rose nearly 14% in a three-week rally, reaching their highest level since mid-May near $4,700.
The precious metal lost its bullish momentum as the US Dollar stabilized ahead of key data releases, causing Gold to correct lower and lose more than 1% on Wednesday.
Strategists at Deutsche Bank noted that the latest US economic releases were a 'solid slate of data' that was hard to square with a view that Fed policy is restrictive.
Cleveland Fed President Beth Hammack delivered a hawkish message, emphasizing the need for tighter policy to re-anchor expectations and underscoring a readiness to endorse further rate hikes or resist cuts.
Fed Chair Kevin Warsh's speech at the Jackson Hole Symposium reinforced a firm 2% PCE target, highlighting that resilient activity and loose credit conditions could keep the Fed cautious about cutting rates too soon.