Gold Plunges to Two-Week Low Amid Hawkish Fed Comments

Gold prices have declined to a two-week low at $4,417 per ounce on August 31, 2026, following a steep drop of over 3% on August 28 after Federal Reserve Chair Kevin Warsh delivered hawkish remarks.

The comments by Warsh emphasized that US monetary policy may need to stay restrictive longer to tackle persistent inflation, which has not improved as hoped. This stance sharply increased market expectations for a September interest rate hike, with probabilities jumping from roughly 35% to around 57-60%.

Warsh's comments reverberated through financial markets by strengthening the US dollar and pushing Treasury yields higher. For gold, a non-yielding asset, this dynamic reduces its attractiveness as investors demand higher returns elsewhere.