Gold Mixed as Fed Cues Meet Oil

Gold Mixed as Fed Cues Meet Oil

At 16:45 ET (20:45 GMT) on Monday, spot gold was down 0.3% to $4,163.56 per ounce, while gold futures rose 1.2% to $4,175.20 per ounce. The mixed movement came as market participants weighed the Federal Reserve’s monetary‑policy outlook against easing inflationary pressures linked to falling oil prices.

The backdrop was a softer‑than‑expected U.S. non‑farm payroll report for June, which suggested a resilient yet not overly strong labour market. Fed Chair Kevin Warsh, who took office last month, reiterated in public comments in Portugal that the Fed would abandon forward guidance and focus solely on combating inflation. He emphasized that inflation risks had receded, noting that oil prices had slipped back to pre‑conflict levels and that the June employment report showed no signs of overheating.

The minutes of the Fed’s June meeting, to be released on Wednesday, are expected to show that half of the policymakers believed further rate hikes could still be warranted this year. Wells Fargo analysts led by Tom Porcelli said the recent inflation strength appears driven largely by supply‑side factors such as tariffs and energy, which should fade over time, and they continue to expect the Federal Open Market Committee to keep the funds rate on hold for the foreseeable future.

On the supply side of energy, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, agreed over the weekend to increase production targets by 188,000 barrels per day starting in August, extending the phased rollback of voluntary output cuts. While much of the additional output has yet to reach the market, the decision reinforces expectations that oil supply will continue to recover as Gulf conditions normalise.

Shipping traffic through the Strait of Hormuz remained resilient, with Kpler data reporting 108 verified vessel crossings between Friday and Sunday.

In related geopolitical commentary, President Donald Trump told reporters that Iran must hold its concessions and warned that the United States would either reach a deal or finish the job regarding Iran’s nuclear programme. The article also noted that Iran was mourning former Supreme Leader Ayatollah Ali Khamenei, whose death occurred during strikes at the start of the conflict.