Gold Pulls Back as Inflation Data Pushes Yields Higher

Gold prices retreated in early U.S. trading Wednesday after the Commerce Department released personal consumption expenditures (PCE) data, exceeding forecasts and pushing Treasury yields higher.

The PCE price index rose 0.2% month-over-month and 3.7% from a year earlier, while core PCE advanced 0.2% on the month and 3.3% annually. These inflation prints rippled across markets, causing gold to surrender part of its bid and pull back.

Spot gold traded at $4,633.50 an ounce, down 0.52%, while spot silver edged up 0.26% to $68.720.

The August rally that put gold up 15% for the month, its best monthly performance since 2008, has clearly cooled. From a technical standpoint, gold and silver remain within a broader breakout structure, but momentum has slowed. The SPDR Gold Trust (GLD) held above the $4,567 support zone yet slipped back under the $4,661 resistance level.

A large options trade drew attention in the derivatives market, with a single call spread sale collecting roughly $202 million in total premium and netting about $60 million in credit. The position involved selling more than 115,000 contracts of the 420-strike calls while purchasing higher-strike calls as protection.