Key Takeaways:
- Spot gold fell 3.08% to $4,457.57/oz Friday after Fed Chair Waller's hawkish Jackson Hole remarks
- Silver dropped 4.17% to $66.34/oz; COMEX copper slipped 0.84% to $6.6330/lb
Precious metals weekly performance:
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Gold falls 3.1% to $4,457 after Waller's hawkish Jackson Hole speech
Spot gold fell 3.08 percent to $4,457.57/oz in New York late trading Friday, its steepest one-day drop in recent weeks, after Federal Reserve Chair Waller delivered a hawkish anti-inflation message at the Jackson Hole Global Central Bank Symposium.
Waller said the 2 percent inflation target is "firm and fixed" and that current data are insufficient to demonstrate a "meaningful" slowdown in price pressures, according to his prepared remarks. He also stated that financial conditions are not restrictive and that policymakers "still have work to do" on inflation.
Gold briefly rose to $4,631.61/oz at 22:00 Beijing time when the speech draft was released, before reversing sharply to close the session lower. For the week, gold lost 3.22 percent, silver fell 3.89 percent, and copper declined 0.73 percent. The selloff extended across the metals complex as traders repriced the Federal Reserve's rate path.
The hawkish tone pushed short-term Treasury yields higher and strengthened the U.S. dollar, with CME data showing 57.2 percent of dollar option flows this week positioned for greenback strength, up from 43.2 percent last week. Higher real interest rates raise the opportunity cost of holding non-yielding assets such as gold and silver.
Core PCE at 3.7% Keeps September Hike in Play
The July Core PCE price index rose 3.7 percent year-over-year, unchanged from June and above the 3.6 percent consensus, keeping inflation above the Fed's 2 percent target for a 65th consecutive month. Federal funds futures now price about a 36 percent chance of a rate hike at the September FOMC meeting.
The Fed's internal divisions add to the uncertainty. Kansas City Fed President Jeff Schmid said short-term rates "may still be relatively loose," while Boston Fed President Susan Collins argued rates remain "somewhat restrictive." This lack of consensus means metals traders face a wide range of possible policy outcomes.
The metals selloff mirrors broader risk-asset weakness. Bitcoin fell below $80,000 on Friday, and crypto-mining stocks MARA Holdings and Riot Platforms each dropped roughly 8 percent, while BlackRock's spot Bitcoin ETF IBIT declined about 1.8 percent. The divergence between direct commodity exposure and higher-leverage proxies shows investors are rotating toward yield-bearing assets as rate expectations rise.
Gold at $4,457.57/oz remains well above its levels from earlier this month, and the pullback follows a period of sustained gains. The September FOMC meeting is the next key event for metals traders, where Waller's comments have raised the stakes for policymakers to clarify their stance on further tightening.
This article is for informational purposes only and does not constitute investment advice.
[1] Spot gold falls about 3.1%, Waller's remarks hawkish[2] In his Jackson Hole debut, Waller struck a hawkish tone, stating that the Federal Reserve "still has work to do" and implying readiness to raise interest rates if inflation does not decline rapidly.[3] As Waller’s debut at the Jackson Hole symposium approaches, the dollar’s bullish hedge ratio surges to 57%.[4] Rifts Emerge Within the Federal Reserve—Can Waller's Speech Set the Tone for Policy Direction? | Bitget News[5] Hawkish remarks from Waller dampen risk appetite! Bitcoin falls below $80,000 as mining stocks MARA (MARA.US) and Riot (RIOT.US) suffer heavy losses
