Gold slipped in Asian markets on Friday, pressured by a stronger U.S. dollar as investors scaled back expectations for further Federal Reserve rate cuts ahead of Chair Jerome Powell’s highly anticipated speech. Other precious metals also eased, reflecting the greenback’s resilience, which is positioned for solid weekly gains.
Spot gold declined 0.3% to $3,328.37 an ounce, while gold futures dropped 0.3% to $3,371.15/oz by 00:54 ET (04:54 GMT). However, some safe-haven demand helped cap losses amid lingering geopolitical risks, including signs that a resolution to the Russia-Ukraine conflict remains elusive despite U.S. diplomatic efforts.
Second Consecutive Week of Losses for Gold
Gold has fallen between 0.2% and 0.5% this week, tracking toward a second straight week of declines. The drop stems largely from diminished expectations for a September Fed rate cut. Minutes from the central bank’s late-July meeting, released Wednesday, showed a majority of policymakers favoring a hold in the near term.
CME FedWatch data indicates a 73.1% chance of a 25-basis-point cut in September, down sharply from last week’s 92.2% probability. Prolonged high interest rates continue to weigh on gold and other non-yielding assets by raising the opportunity cost relative to debt instruments like Treasuries.
Markets Await Powell at Jackson Hole
All eyes are on Powell’s address at the Jackson Hole Symposium later Friday, as investors seek guidance on the path of U.S. interest rates. Analysts will be watching whether the Fed Chair comments on recent data showing slightly softer inflation and a cooling labor market.
Powell has previously cited the uncertainty created by President Donald Trump’s trade tariffs as a key factor influencing the Fed’s policy decisions. This uncertainty has prompted traders to reduce rate-cut bets, bolstering the dollar and weighing on metals. The greenback is on track for a weekly gain of about 0.9%.
Platinum spot prices fell 0.7% to $1,347.85/oz, while silver slipped 0.2% to $38.0735/oz, with both metals poised for small weekly gains. Industrial metals were also softer, with London Metal Exchange copper futures down 0.2% to $9,724.10 per ton and COMEX copper futures retreating 0.3% to $4.4420 per pound.
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