Gold steadies near $4,465 after Warsh cue

Gold steadies near $4,465 after Warsh cue

Gold prices edged higher on Monday after a 3% plunge the previous session. At 20:53 ET (00:53 GMT) XAU/USD was up 0.2% at $4,464.65 an ounce, while Gold Futures fell 0.4% to $4,513.50. Silver rose 0.4% to $66.64 an ounce, platinum advanced 0.7% to $1,835.35, and the US Dollar Index slipped 0.1% to 99.60.

Federal Reserve Chair Kevin Warsh warned that the central bank still has work to do to bring inflation back to its 2% target, prompting the market to raise expectations for another rate increase. The CME FedWatch tool now shows roughly a 57% probability of a September Fed hike. Higher rate expectations weigh on gold because the metal pays no interest, and the stronger dollar that followed Warsh’s remarks makes gold more expensive for non‑dollar buyers.

ANZ analysts noted that the sharp decline reflected the shift in rate‑hike expectations but expect the downside to be limited as the debasement trade continues to attract buyers.

Energy markets added pressure: Brent crude rose to around $89.38 a barrel and US crude to $84.50 after US forces struck Iranian launchers on Larak Island, and Iran subsequently attacked US forces in Jordan, heightening concerns of an escalating conflict and sustained elevated oil prices.

The US Treasury unexpectedly increased purchases of longer‑dated government bonds earlier in the month, pushing yields lower, weakening the dollar and reviving concerns that rising government debt and borrowing‑cost management could erode confidence in US assets. This debasement theme helped drive gold’s roughly 65% rally in 2025 as investors used bullion as a hedge against widening budget deficits, currency depreciation and declining purchasing power.

Gold remains about 10% higher in August, on track for its strongest monthly gain since January. It rebounded sharply from a late‑June low near $3,942 and has stayed well above the $4,000 threshold.

Markets will watch upcoming US employment and inflation data for evidence that could either reinforce the September hike case or reverse some of the hawkish positioning.