2 weeks ago
Gold Steadies as Fed Rate Path and Mideast Tension Weighed
Gold is a shiny metal that people buy to keep their money safe.
This week, its price went up a little and then came back down, like a seesaw.
One ounce of gold costs about $4,360.
Lots of people and countries buy gold when they are worried.
China has been buying lots of gold recently.
There is also a war between the United States and Iran, which makes people nervous.
When people are nervous, they often buy gold instead of other things.
Big money experts called the Federal Reserve decide if borrowing money gets more expensive.
If it does not, gold usually stays attractive.
For now, gold is staying steady while everyone watches what happens next.
Gold was little changed after retreating below $4,400 an ounce, with spot gold up 0.2% to $4,359.73 in Singapore.
Traders are weighing the Federal Reserve's interest-rate path and prospects for a deal to reopen the Strait of Hormuz.
A subdued US inflation print for July suggested energy-price shocks from the US-Iran war faded, reducing pressure for aggressive rate hikes.
Money markets price in roughly a one-in-three chance of a September rate hike, with investors awaiting Fed Chairman Kevin Warsh's Jackson Hole remarks later in August.
Gold's recovery above $4,000 has been driven by investor appetite and central bank purchases, notably from China, though strategists at Oversea-Chinese Banking Corp. see stretched technical momentum.
- Who
- Traders and investors, the Federal Reserve, Fed Chairman Kevin Warsh, and central banks including China's, with commentary from strategist Christopher Wong of Oversea-Chinese Banking Corp.
- What
- Gold prices steadied after retreating below $4,400 an ounce, with spot gold up 0.2% to $4,359.73, as markets weighed the Fed's rate path and Middle East tensions.
- Where
- Spot gold was quoted in Singapore; tensions around the Strait of Hormuz and the broader Middle East are key factors.
- When
- Reported during August trading following a subdued US inflation print for July; the Fed meets next month and Warsh speaks at Jackson Hole later in August, while the US-Iran war began in late February.
- Why
- A subdued US inflation print reduced pressure for aggressive Fed rate hikes, while renewed investor appetite and central bank purchases, notably from China, supported gold's recovery above $4,000.
Key facts
- Spot gold price
- $4,359.73/oz, up 0.2%
- Thursday move
- Gold shed 1.3% after retreating below $4,400/oz
- Silver price
- $64.55/oz, little changed
- September rate hike odds
- Roughly one-in-three
- US inflation data
- Subdued print for July
- Central bank demand
- Notable purchases from China; gold recovered above $4,000/oz
- US-Iran war start
- Late February
- Key events ahead
- Employment reports due; Fed meeting next month; Jackson Hole symposium later in August
Quotes
Christopher Wong
Strategist at Oversea‑Chinese Banking Corp.
“The macro setup has turned more constructive, although positioning is less supportive and technical momentum is starting to look stretched after the recent rebound. Consolidation risks remain around current levels.”
livemint.com
Sources
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