BlockBeats news: On August 29, after Federal Reserve Chair Powell delivered remarks on curbing inflationary pressures, market expectations for Fed rate hikes surged, strengthening the U.S. dollar and pressuring precious metals like gold lower. As of reporting, spot gold fell 2.6% on the day, dropping over $120 to $4,480 per ounce, and touched a weekly low of $4,464 during trading.
Independent analyst Tai Wong noted: "Chair Wosh clearly stated that inflation has not yet shown meaningful signs of slowing and emphasized that the Fed 'still has work to do,' triggering a sharp sell-off in the gold market. Although this may still be a 'loud thunder, light rain' communication strategy, it is sufficient to lead markets to view the September meeting as a closely balanced contest between a rate hike and a pause. Wosh’s remarks represent his most explicit indication to date that further rate increases may be necessary to ease price pressures. He stated that if policymakers cannot be confident that underlying inflation is steadily returning to the 2% target, the Fed 'still has work to do.'"
As a result, traders quickly increased their bets on a September rate hike. Among other precious metals, spot silver fell 3.63% to $66.77 per ounce; spot platinum turned from gains to losses during the session, dropping 0.27% to $1,841.90; and spot palladium's gains narrowed to 5.05%, trading at $1,418.30.