The precious metal is showing confident momentum, having settled above the $4,600 per ounce mark. After a brief correction, the price recovered by 0.7%, partially recouping the recent decline. The key factor shaping market sentiment is the upcoming speech by the Federal Reserve Chair at the annual Jackson Hole symposium.
On Wednesday, gold interrupted a five-day winning streak, coinciding with the release of fresh inflation data. The figures came in above the Fed's target level, which immediately raised the likelihood of tighter monetary policy. This, in turn, strengthened the U.S. dollar and pushed Treasury yields higher—a classic negative factor for precious metals.
Rally amid devaluation risks
Despite the correction, the fundamental uptrend remains intact. Since the start of the month, gold has gained approximately 14%. Notably, last week the U.S. Treasury made an unexpected intervention in the bond market, which only heightened investor interest in safe-haven assets.
Market participants have once again turned to the "devaluation" scenario, actively buying hard assets amid a growing budget deficit and a weakening U.S. currency. This very factor became the catalyst for gold's record rally in 2025. The metal is posting its fastest growth since 1999 and has firmly settled above the 200-day moving average. Many traders view this as a classic trend reversal signal.
The dynamics of exchange-traded funds (ETFs) are also telling: gold ETF holdings rose by more than 28 tonnes over the week—the largest inflow since January. Notably, a two-month outflow from these instruments was observed as recently as summer, but institutional investor interest has clearly returned now.
Warsh's debut: what to expect from "hawkish" rhetoric?
The Jackson Hole symposium is an annual gathering of central bank leaders organized by the Kansas City Fed. It was here in 2022 that the Fed announced its shift to a restrictive policy stance, so traders traditionally expect important signals from this event.
On Friday, Chair Kevin Warsh will deliver his first major speech in this role. He will need to address criticism over his reticence in assessing the economy. Warsh is capable of tightening the Fed's "hawkish" rhetoric. If his words align with that scenario, real yields and the dollar could rise, putting pressure on gold. In the case of a "dovish" signal, the precious metal would gain fresh momentum to update local highs.
My view: the market is in a state of fragile equilibrium. The technical picture for gold remains bullish, but Warsh's verbal intervention could trigger short-term volatility. Investors should be prepared for sharp moves in either direction on Friday.