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Gold falls as core PCE inflation supports more hawkish Fed bets

The drop comes after July Core PCE matched expectations at 3.3% year over year, keeping rate hike odds elevated for later 2026.

Reported · Written up by our desk · Precious Metals

Gold prices slid more than 1% on Wednesday, trading below $4,600 after reaching a daily high around $4,625, as data out of the United States reinforced expectations of a higher for longer path for interest rates, according to FXStreet.

The shift followed the release of the Fed’s preferred inflation measure, July Core Personal Consumption Expenditures (PCE), which came in line with estimates and matched June at 3.3% year over year. Headline inflation was unchanged at 3.7% year over year for a second straight month, above forecasts of 3.6%, FXStreet added.

FXStreet said the data increased the chances of a Fed rate hike toward the end of 2026, citing Prime Terminal odds near 77% for a December increase. The report also tied gold’s move to rising energy prices amid geopolitical rumors and a renewed uptrend in US bond yields.

Additional macro items on the docket include Initial Jobless Claims, the University of Michigan Consumer Sentiment Index, and a speech by Fed Chair Kevin Warsh at the Jackson Hole Symposium, FXStreet noted. It also pointed to a bearish “evening star” chart pattern, with a potential move toward the 200-day simple moving average near $4,378 if gold closes below $4,594.

Latest closeGold $4,432.00 ▲1.6%

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