World gold prices recovered more than 1% to stand back above the $4,600 per ounce level on Thursday, as markets awaited a speech by Kevin Warsh, the Federal Reserve Chair, at the Jackson Hole meeting on Friday. Gold prices rose 1.1% to $4,639.45 per ounce at 10:17 a.m. Singapore time, after declining on Wednesday due to U.S. inflation data exceeding the target, which increased market expectations of a Fed rate hike, strengthening the dollar and pushing bond yields higher. However, gold prices are still up nearly 15% in August, supported by the U.S. Treasury's intervention in the bond market, which has spurred interest in the 'debasement trade' strategy. Investors are using gold as a hedge against budget deficits and a weakening dollar. Analysts at Zijin Tianfeng Futures noted that gold prices remain above the 200-day moving average, a sign of strength, and if Warsh does not signal a rate hike in September, the market may interpret it as dovish, which would be positive for gold. Additionally, the independence of the Fed is a key focus, following Fed Governor Lisa Cook's denial of allegations of mortgage fraud, amid President Trump's efforts to remove her from her position. Among other precious metals, silver rose 2% to $69.49 per ounce, while platinum and palladium also gained.
Gold price surge and inflation data may influence Fed rate decisions, affecting bond yields.
