Warsh's Jackson Hole Speech Weighs on Gold Prices
Gold prices were subdued in early Asian trading on Friday as markets geared up for US Federal Reserve Chair Kevin Warsh's highly anticipated remarks at the Jackson Hole symposium.
Fed officials shared their ongoing concerns about the US inflation landscape, citing a 3.7% Personal Consumption Expenditures Price Index in the 12 months through July.
The number of Americans seeking unemployment benefits for the first time fell for a second week, and the overall number of people on jobless relief rolls slid to the lowest level in a month, signaling a stable labor market that should give the Fed leeway to focus on containing inflation.
Despite its role as an inflation hedge, gold tends to lose appeal in a high interest-rate environment as it offers no yield. Traders see a 35.4% chance of a US rate hike in September and a 74.6% chance by December, according to the CME FedWatch Tool.