Warsh Hawkish Tilt Pushes Gold Below $4,600
US Treasury yields and the US Dollar rose on Friday after Federal Reserve Chair Kevin Warsh confirmed that inflation remains a priority for the central bank. The Fed's hawkish tilt led to a decline in gold prices, with the precious metal dropping below $4,600.
The XAU/USD traded at $4,576 after diving below $4,600 and refreshing weekly lows of $4,530. Warsh emphasized that underlying measures of inflation haven't improved and that the Fed must be confident that inflation is returning to its 2% goal.
Money markets have begun to price in a potential rate hike in 2026, with investors trimming the odds for a September rate hike but increasing them for December. The Greenback rose by over 0.38%, as measured by the US Dollar Index (DXY), which tracks the value of the American currency against six other currencies.