Gold Slides to Two-Week Low Amid Rising Rate Hike Expectations

Gold prices continued to slide in Asian trading on August 31, reaching a roughly two-week low of $44,423.84 per ounce. The decline was fueled by Fed Chair Warsh's speech at the Jackson Hole Symposium, where he signaled the possibility of additional rate hikes to curb inflation.

The market reaction was swift, with the probability of a September rate hike surging from 36% before the speech to 57%, according to CME FedWatch. This shift in rate expectations made gold less attractive as an investment, given its non-interest-bearing nature.

Spot gold fell 0.7% from its previous close, while U.S. gold futures dropped 1.3%. Japanese gold futures also declined, with the August 2027 contract opening at ¥23,650 per gram, down ¥625 from the previous weekend's settlement price.