Warsh's Hawkish Stance Sparks Gold Price Volatility

Gold prices remained steady on Monday after plummeting over 3% in the previous session due to comments from U.S. Federal Reserve Chair Kevin Warsh.

Warsh stated that policymakers would 'have work to do' if they don't get confidence that inflation is heading down to 2%, hinting at potential interest rate hikes.

This has increased the probability of a rate hike at the Fed's next policy meeting in September, now standing at 57% according to the CME FedWatch tool, up from 36% prior to Warsh's comments.

Higher interest rates typically weigh on gold prices as holding non-yielding assets becomes less attractive.