Gold prices slipped on Friday as the dollar strengthened, with investors awaiting Federal Reserve Chair Jerome Powell’s remarks at the annual Jackson Hole symposium for potential signals on the future direction of monetary policy.
In Dubai, gold rates declined, with 24-carat gold losing AED1.5 to AED401, and 22-carat gold losing AED1.25 to AED371.25. Meanwhile, 21-carat gold declined AED1.25 to AED356, and 18-carat gold fell AED1 to AED305.25.
Globally, spot gold slipped 0.26 percent to $3,329.85 as of 5:45 GMT. Meanwhile, U.S. gold futures for December delivery dipped 0.26 percent to $3,372.80.
The U.S. dollar index hovered close to a two-week high, reducing gold’s appeal for international buyers.
Rate cut bets fall ahead of Powell’s remarks
On Thursday, Fed officials showed little enthusiasm for a potential rate cut next month, as investors awaited Powell’s speech scheduled for 1400 GMT on Friday. Gold prices remain under pressure, weighed down by the prospect of a Russia-Ukraine peace deal and renewed dollar strength. However, if Powell’s remarks are seen as dovish, the dollar could weaken, giving gold prices a boost.
According to CME’s FedWatch tool, futures markets are currently pricing in a 75 percent probability of a quarter-point rate cut next month, down from 82.4 percent in the previous session.
Recent labor data revealed that U.S. jobless claims jumped last week at the sharpest pace in nearly three months, while the prior week’s filings reached their highest level in almost four years.
The dilemma for Fed policymakers is that, despite indications of a cooling labor market, inflation remains above the central bank’s 2 percent target and could rise further amid the Trump administration’s aggressive tariff increases on imports.
Hopes for Russia-Ukraine peace deal fade
Gold prices remain supported as traders are factoring in greater risk as hopes fade that U.S. President Donald Trump can swiftly broker a Russia-Ukraine peace deal. Efforts to arrange a Putin-Zelenskiy summit remain stalled, and talks on possible security guarantees face hurdles. The slimmer the chances of a ceasefire, the higher the likelihood of tougher U.S. sanctions on Moscow.
The three-and-a-half-year war showed no signs of easing on Thursday, with Russia carrying out an airstrike near Ukraine’s EU border and Kyiv reporting a strike on a Russian oil refinery. At the same time, U.S. and European officials said allied security advisers have drawn up new military options.
The developments came after the weekend’s first in-person meeting between U.S. and Russian leaders since the invasion, which produced little progress toward peace.
Russian President Vladimir Putin has demanded that Ukraine cede the entire eastern Donbas region, abandon its NATO aspirations, and bar Western troops from its territory, according to sources familiar with the matter. Meanwhile, Trump has vowed to guarantee Ukraine’s security under any potential peace deal, and Ukrainian President Volodymyr Zelenskiy rejected surrendering internationally recognized land.
Other precious metals
As gold prices declined, the precious metals market witnessed mixed movement on Friday. Spot silver fell 0.38 percent to $38.02, while platinum dipped 0.70 percent to $1,344.06. Meanwhile, palladium gained 0.19 percent to $1,112.67.
