Gold and Silver Prices May Extend Rally Amid US Inflation Data and Fed Signals

Gold and silver prices are expected to remain firm next week after posting strong gains, although profit-booking at higher levels may limit the rally, according to analysts. Bullion traders will closely track US inflation and economic data along with signals from the Federal Reserve for the next direction in precious metals.

The US Core Personal Consumption Expenditures (PCE) inflation data and GDP figures will be among the biggest triggers for gold and silver prices. The Jackson Hole symposium, scheduled for August 27-29, will also remain in focus, with Federal Reserve Chair Kevin Warsh set to deliver his first keynote address at the event.

Pranav Mer, Senior Vice President of EBG - Commodity & Currency Research at JM Financial Services, expects the overall bias to remain positive, though some profit-booking cannot be ruled out. West Asia developments, particularly the US-Iran peace process and the possible reopening of the Strait of Hormuz, will also be closely monitored.