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Gold slips below $4,650 as the US dollar firms ahead of PCE data
Gold is pressured by a firmer USD and expectations of a policy hold at the September FOMC meeting, while Treasury buybacks are cited as pushing bond yields lower.
Gold is trading with a bearish bias below $4,650 as the US dollar regains positive traction ahead of the release of the US Personal Consumption Expenditures, or PCE, Price Index, FXStreet reported.
The article points to an interest rate outlook that could be influenced by US inflation data and remarks from Federal Reserve Chair Kevin Warsh at the Jackson Hole Symposium on Friday, with markets shifting toward a September 15 to 16 FOMC policy hold as price pressures cool and labor conditions remain sluggish.
FXStreet also links the gold move to lower US bond yields, attributing the decline in part to the US Treasury’s buyback strategy, including references to using near $1 trillion from the Treasury’s General Account to fund longer-term bond purchases.
Further headwinds for the dollar and support for gold, the report says, come as positive Middle East developments ease pressure on inflation expectations by weighing on crude prices, with oil falling to a nearly two-week low after Iran said it restarted talks with Oman to manage commercial shipping traffic through the Strait of Hormuz.
Latest closeGold $4,432.00 ▲1.6%|WTI crude $82.40 ▲1.4%