Gold Pauses Above $4,600 as Market Awaits Fed Rate Signals at Jackson Hole

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Gold traded above $4,600 an ounce as investors looked ahead to signals on US monetary policy from this week’s Jackson Hole symposium.

Spot gold rose 0.6% to $4,619.54 an ounce as of 7:38 a.m. in Singapore on August 26, according to Bloomberg. It gained as much as 0.7% earlier in the session.

The metal ended a five-day rally in the previous session after US inflation data showed prices still running well above the Fed’s target. That strengthened bets the central bank could raise interest rates if inflation pressures persist, lifting the dollar by the most in two weeks and pushing US Treasury yields higher.

Even so, gold is still up about 14% this month. The rally has been supported in part by a revival of the so-called debasement trade after the US Treasury moved last week to expand long-term bond buybacks, fueling concern over the US fiscal burden and a weaker dollar.

Funds are also flowing into the gold market. Bullion recently climbed above its 200-day moving average, a key trend indicator, while spot gold exchange-traded funds tracked by Bloomberg saw inflows of more than 28 tons last week, the biggest since January.

Investors are also focused on Fed Chair Kevin Warsh’s Jackson Hole speech on August 28. As Warsh prepares to deliver his first major address at the gathering since taking office, markets are watching for clues on the Fed’s view of elevated inflation and the path of interest rates.

Silver rose 1.3% to $68.99 an ounce, while platinum and palladium also advanced. The Bloomberg Dollar Spot Index slipped 0.1% after rising 0.2% a day earlier.