Gold holds near US$4,600 as investors focus on US Fed rate-hike path

Gold settled near US$4,600 per ounce as investors evaluated the trajectory of US interest rates, ahead of a crucial speech by Federal Reserve Chairman Kevin Warsh. Bullion experienced minimal movement after gaining 0.2 percent in the prior session, but continued its trajectory toward its largest monthly gain since 1999. The metal received renewed support from an unexpected intervention by the US Treasury in the bond market, reigniting interest in the debasement trade that fueled gold's record-breaking surge in 2025.

Investors are eagerly awaiting clues about the US Fed's stance on inflation when Warsh delivers his first major address as chairman at the US central bank's annual Jackson Hole symposium on August 28. Economists and policymakers are divided on whether to raise interest rates in the coming months, a factor that would weigh on non-yielding gold.

Despite the Federal Reserve leaving borrowing costs unchanged in July, three officials dissented in favor of a quarter-point increase. During the Jackson Hole symposium on Thursday, two central bank officials stated that interest-rate setting was not impeding the US economy, despite inflation persisting above a 2 percent target, urging their colleagues to act quickly to alleviate price pressures.

However, Susan Collins, president of the Bank of Boston, suggested there is evidence that rates are "mildly restrictive." The rebound in gold, which is projected to gain nearly 14 percent in August, has been bolstered by diverse investor involvement. Gold-backed exchange-traded funds tracked by Bloomberg added over 28 tonnes in the week ending August 23, the highest since January, followed by an additional 20 tonnes this week.

Central banks have also intensified their purchases. Spot gold increased by 0.1 percent to US$4,603.23 an ounce at 7:15 am in Singapore. Silver also rose by 0.1 percent to US$69.28 an ounce, while platinum and palladium gained slightly as well. The Bloomberg Dollar Spot Index, a measure of the US dollar, fell by 0.1 percent.