Gold prices were little changed on Friday as investors waited for Federal Reserve Chair Kevin Warsh’s closely watched speech at the Jackson Hole symposium.
Traders are looking for fresh signals on the outlook for U.S. interest rates, inflation, and future Federal Reserve policy.
Spot gold was broadly flat at $4,600.19 an ounce by 02:50 ET (06:50 GMT). Meanwhile, U.S. gold futures slipped 0.3% to $4,651.41.
Gold Holds Near Recent Highs
Gold reached a three-month high close to $4,700 an ounce earlier this week.
Demand for the precious metal was supported by concerns surrounding U.S. fiscal policy and recent Treasury measures aimed at supporting longer-term bonds.
Despite those gains, gold was heading for a small weekly decline after rising for three consecutive weeks.
Investors have remained cautious ahead of Warsh’s Jackson Hole speech, limiting the metal’s ability to extend its recent rally.
Warsh Speech Puts Fed Policy in Focus
Warsh is scheduled to deliver his remarks at 10:00 a.m. ET on Friday.
His first major Jackson Hole speech as Federal Reserve chair is expected to attract significant attention from financial markets.
Investors will be listening closely for comments about inflation, interest rates, and the Fed’s broader monetary policy strategy.
Recent economic data have made the outlook more complicated.
Inflation Data Raises Rate Hike Expectations
The personal consumption expenditures price index, which is closely monitored by the Federal Reserve, rose 3.7% year over year in July.
The stronger inflation reading increased speculation that the Fed could raise interest rates again this year.
According to the CME FedWatch tool, markets were pricing in around a 34% probability of a rate hike in September.
The likelihood of an increase by December stood at approximately 74%.
Higher interest rates are generally negative for gold because the metal does not generate interest. As yields rise, interest-bearing assets can become more attractive by comparison.
Dollar and Bond Yields Remain Key Drivers
Gold has recently benefited from lower Treasury yields and a weaker U.S. dollar.
Lower yields reduce the opportunity cost of holding non-yielding assets such as gold.
A softer dollar can also support precious metals by making them less expensive for buyers using other currencies.
Despite Friday’s subdued trading, the broader trend for gold remains strong. The metal has gained more than 13% during August.
Silver and Platinum Move Higher
Other precious metals also advanced.
Silver prices rose 1.3% to $70.11 an ounce, while platinum gained 1.8% to $1,882.60 an ounce.
Copper prices also moved slightly higher.
Benchmark copper futures on the London Metal Exchange gained 0.4% to $14,338.15 per ton, while U.S. copper futures rose 0.2% to $6.68 per pound.
Overall, gold traders remain focused on Warsh’s Jackson Hole remarks. Any new guidance on inflation or interest rates could influence the U.S. dollar, Treasury yields, and precious metal prices.
