Gold Prices Slip Ahead of Jackson Hole Speech
Gold prices slipped on Friday as investors awaited Federal Reserve Chair Kevin Warsh's speech at the Jackson Hole symposium. Spot gold fell by 0.5% to $4,580.19 per ounce by 0438 GMT, while U.S. gold futures eased 0.7% to $4,632.40.
Analyst Matt Simpson from StoneX noted that the case for Warsh leaning hawkish is greater than the case for him not to, which could see gold retreat further from its cycle highs in the near term.
However, Simpson also predicted that any dip will be viewed favorably by bulls who missed out on the first phase of the rally and are keen to have another crack at $5,000.
The U.S. inflation landscape remains a concern for Fed officials, with the Personal Consumption Expenditures price index standing at 3.7% in the 12 months through July. Traders see a 33.7% chance of a U.S. rate hike in September and a 74.2% chance by December.
Gold tends to lose appeal in high-interest rate environments as it offers no yield, but improving participation in exchange-traded funds and futures, along with concerns over U.S. fiscal credibility and continued official-sector buying, are supporting gold prices.