Gold Prices Plummet Amid Fed's Inflation Reaffirmation

Gold and silver prices plummeted on August 29th after Federal Reserve chair Kevin Warsh reaffirmed the central bank's commitment to a 'firm and fixed' 2% inflation target at the Jackson Hole conference.

Warsh signaled that short-term interest rates remain the primary tool for managing inflation, keeping a September rate hike in play. This move sent gold prices down as much as 3.2% to $4,515/oz on the Comex exchange, while silver dropped 4.1% to $67.34/oz.

The decline contrasts with double-digit gains for both metals in August, with gold up about 11% and silver rising 71% over the past 12 months. Precious metals equities fell 4-6% intraday but remain up significantly year-to-date, with Eldorado Gold, Hecla Mining, Equinox Gold, and Agnico Eagle all posting gains of 51%, 44%, 43%, and 41%, respectively.

Agnico Eagle's strong performance is notable, despite losing 370,000 oz due to a pit wall failure at its Canadian Malartic mine. The company maintained its 2026 production guidance, suggesting it is better positioned than peers to withstand further Fed-driven volatility in bullion prices.