Warsh's Jackson Hole Remarks Weigh on Gold Prices
Gold prices slipped yesterday as traders weighed the latest inflation data and waited for Federal Reserve Chair Kevin Warsh's speech at Jackson Hole. The US inflation rate remains a concern, with the personal consumption expenditures (PCE) price index up 3.7% over the past 12 months through July.
The PCE is the Fed's preferred inflation measure, and officials have recently sounded cautious about declaring victory in their fight against inflation. As a result, traders are waiting to see how Warsh will address the situation at Jackson Hole.
CME FedWatch puts the odds of a September rate hike at 33.7% and the chance of at least one hike by December at 74.2%. This has put pressure on gold prices, which fell 0.5% to $4,580.19 an ounce after reaching a peak of $4,696.18 on Tuesday.
The outlook for silver is also looking uncertain, with OCBC pointing out that $70.60-$72 could be a tough area for the metal to clear without renewed softness in yields and the dollar.