Gold Price Today, August 28: Gold prices traded slightly lower on Friday, August 28, as investors remained cautious ahead of Federal Reserve Chair Kevin Warsh’s speech at the Jackson Hole symposium. The precious metal was also headed for a marginal weekly decline despite continuing to trade near the USD 4,600-per-ounce mark.
As of 5:55 a.m., spot gold was down 0.2 per cent or USD 10.70 at USD 4,591.29 per ounce. On a weekly basis, bullion was also lower by 0.2 per cent.
Spot silver mirrored gold’s trend, slipping to USD 69.14 per ounce. However, the white metal remained on track to post a weekly gain.
In the domestic market, gold and silver futures were not trading at the time of writing. In the previous session, gold futures on the Multi Commodity Exchange (MCX) settled at Rs 1,59,189 per 10 grams, while silver futures ended at Rs 2,40,573 per kilogram.
Focus on Jackson Hole
Market participants are closely monitoring comments from Federal Reserve Chair Kevin Warsh at the central bank’s annual symposium in Jackson Hole, Wyoming.
Warsh’s remarks are considered important for gold as any indication regarding the future path of US interest rates can significantly influence Treasury yields and the US dollar, both of which are key drivers of bullion prices.
Why are gold prices down this week?
Gold has faced pressure this week from a stronger US dollar and inflation data that reinforced expectations of higher-for-longer interest rates.
The US dollar index, which measures the greenback against a basket of six major currencies, was up 0.3 per cent for the week. A stronger dollar typically makes gold more expensive for buyers using other currencies, dampening demand and weighing on prices.
Adding to the pressure, US inflation data released this week largely met market expectations. The Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred inflation gauge, rose 3.7 per cent year-on-year in July, according to the Commerce Department’s Bureau of Economic Analysis.
With inflation remaining elevated and broadly in line with forecasts, markets reduced expectations of near-term rate cuts. This supported both the US dollar and Treasury yields, creating a less favorable environment for non-yielding assets such as gold.
Gold Outlook
Looking ahead, the direction of bullion prices will likely depend on a series of key US economic releases due next week, including employment data and weekly jobless claims figures.
Investors will also keep a close watch on geopolitical developments in the Middle East, which could influence safe-haven demand.
In the latest development involving Iran, Tehran’s security chief Mohsen Rezaei said the country is preparing a list of conditions for reopening the Strait of Hormuz following a request from mediators, according to a Reuters report.
Any escalation or easing of tensions in the region could affect energy markets and broader risk sentiment, factors that often have an indirect impact on gold prices.
