Gold Price Tumbles Over $147/Ounce Amid Fed's Inflation Priority

The gold price plummeted more than $147 per ounce after the US Federal Reserve signaled its intention to prioritize controlling inflation over addressing labor market concerns.

This shift in focus was evident in Fed Chairman's speech at the annual conference in Jackson Hole, where he emphasized that the current state of full employment is suitable for most people who want to work, while price movements are a growing concern.

The Personal Consumption Expenditure Price Index (PCE), which the Fed closely monitors, rose by 3.7% over the past 12 months and 4.1% annually in the last six months, far exceeding the agency's 2% inflation target.

The market responded rapidly to this new information, with expectations of a September interest rate hike increasing from about 36% to nearly 60%. This has put pressure on gold prices, which have lost significant support levels and continue to sell off as investors adjust their expectations for US interest rates.