Gold futures and spot prices eased on Wednesday after a three-week winning streak, with spot gold declining 0.7% to $4,624.97 per ounce by 06:08 ET. Futures followed, down 0.3% to $4,680.51 per ounce. The pullback came as oil prices fell below $90 per barrel, reducing inflation pressures that had supported the precious metal.
Oil’s decline reflected diplomatic efforts to stabilize the Middle East, including reports that Iran and Oman were negotiating a temporary maritime corridor to reopen shipping through the Strait of Hormuz. A separate report from a Russian news agency suggested a potential U.S.-Iran ceasefire could be announced within days. Lower energy costs typically ease inflation concerns, reducing urgency for aggressive Federal Reserve tightening.
Market focus remains on U.S. economic data and Fed signals ahead of Friday’s Jackson Hole symposium. Core PCE inflation is projected to accelerate slightly to 0.2% month-over-month in July, while the annual rate is seen steady at 3.3%. Traders scaled back bets on a September rate hike after Boston Fed President Susan Collins indicated that a more restrictive policy stance may soon be warranted, though she stopped short of committing to an immediate move. Deutsche Bank analysts noted her remarks suggest a September hike remains plausible for centrist FOMC members.
Analysts at Trade Nation highlighted the interplay between oil prices and gold, noting that energy costs are a key driver of inflation expectations. With oil easing, some of the upward pressure on inflation-linked assets has subsided, contributing to gold’s retreat from its three-month high.
