Gold at three-week low as Fed officials reiterate hawkishness
Gold traded at the lowest level in more than three weeks as Federal Reserve officials reiterated their commitment to tighter monetary settings to curb inflation.
Bullion capped its first weekly decline in five as traders weighed hawkish comments by policy makers which portended higher interest rates. Fed Bank of Richmond President Thomas Barkin said Friday the central bank was resolved to returning inflation to its 2% target, even if that meant risking a US recession.
All eyes will be on Chair Jerome Powell when he speaks this Friday at the annual gathering of central bankers at Jackson Hole. He’s expected to re-state the Fed’s resolve to keep raising rates to get inflation under control, though he’ll probably stop short of signaling how big officials will go when they meet next month.
Higher rates weigh on non-interest bearing bullion. Investor demand has faltered, with holdings in exchange-traded funds dropping for a 10th straight week, according to initial data compiled by Bloomberg.
Spot gold fell as much as 0.1% to $1 744.88/oz, the lowest level since July 28, and was at $1 746.27 as of 7:50 a.m. in Singapore. The Bloomberg Dollar Spot Index rose 0.1% after climbing 2.1% last week. Silver, platinum and palladium all dropped.
