Gold Remains Under Pressure

Gold fell below $4,350 an ounce on Wednesday, remaining under pressure as hawkish signals from Federal Reserve officials outweighed the impact of declining oil prices on the inflation and interest rate outlook. On Tuesday, Richmond Fed's Tom Barkin warned that inflationary shocks could take time to subside, while Boston Fed's Susan Collins said she supported last week’s rate hike amid concerns that future inflation could remain above the 2% target. Meanwhile, oil prices extended their decline for a sixth consecutive session after President Trump said US officials had a “very good” meeting with Iranian envoys, while Tehran said it could reopen the Strait of Hormuz within seven days if the US eases military pressure and lifts its blockade of Iranian ports. Lower oil prices help ease concerns over higher inflation and additional rate hikes. Elsewhere, China’s gold imports through August surpassed 1,000 tons, already exceeding the full-year total for 2025 amid strong investment demand.

Gold steadied above $4,350 an ounce on Wednesday following a sharp intraday rebound in the previous session, as oil prices extended their decline for a sixth consecutive session, easing concerns over higher inflation and interest rates. Oil prices continued to fall after President Donald Trump said US officials had a very good meeting with Iranian envoys, while Tehran said it could reopen the Strait of Hormuz within seven days if the US eases military pressure and lifts its blockade of Iranian ports. Reports also indicated that Saudi Arabia plans to restore oil exports through its East-West pipeline in the coming days. Meanwhile, Richmond Fed President Tom Barkin warned on Tuesday that inflationary shocks could take time to fade, with a risk that elevated price pressures could become entrenched. Elsewhere, China’s gold imports through August exceeded 1,000 tons, already surpassing the total for 2025 amid strong investment demand.

Gold prices eased to around $4,330 an ounce on Tuesday, extending losses from the previous session as hawkish comments from Federal Reserve officials reinforced expectations that US interest rates will remain higher for longer. The US central bank raised its policy rate by 25 basis points last week, marking its first such move in three years, while Chair Kevin Warsh signaled that further rate increases could follow in the months ahead. Other Fed officials, including St. Louis Fed President Alberto Musalem and Chicago Fed President Austan Goolsbee, continued to emphasize the need for additional tightening to curb inflation fueled by strong demand and rising energy prices. Markets are now pricing in a roughly 90% probability of another rate hike in December, according to the CME FedWatch Tool. Elsewhere, oil prices fell for a fifth consecutive session following reports that Iran could reopen the Strait of Hormuz within seven days if the US takes initial steps to ease military pressure.