Gold prices experienced a slight dip but remained near a two-week high as investors anticipated key inflation data and digested ongoing uncertainty surrounding US monetary policy and political tensions. The metal found support from increased speculation about potential Federal Reserve rate cuts and robust demand from Asian markets.
- Gold dipped to around $3,380 per ounce.
- Investors are awaiting Friday’s PCE price index.
- Political and institutional uncertainty between the US administration and the Federal Reserve is supporting the price.
- President Trump moved to dismiss Fed Governor Lisa Cook, leading to a legal challenge.
- Markets are pricing an 89% chance of a 25 bps Fed rate cut in September, up from 82% a week earlier.
- New York Fed President John Williams indicated a rate reduction was under consideration.
- China’s net gold imports via Hong Kong surged 126.8% in July from June.
The data suggests a complex environment influencing the asset’s value. While a slight price decrease was observed, several factors are providing underlying support. Expectations of looser monetary policy in the US, combined with strong demand from Asia, are creating a bullish dynamic. However, political and institutional instability introduce an element of risk and potential volatility, which investors are closely monitoring.