Gold dipped to around $3,380 per ounce on Thursday, retreating from a two-week high as investors awaited fresh policy signals ahead of Friday's PCE price index, the Fed's preferred inflation gauge. Nevertheless, the metal held near record levels, supported by political and institutional uncertainty between the US administration and the Federal Reserve.
President Trump recently moved to dismiss Fed Governor Lisa Cook, but her lawyer vowed to challenge the decision in court, setting up a legal battle. Traders also increased bets on Fed easing, with markets pricing an 89% chance of a 25 bps cut in September, up from 82% a week earlier.
Adding to the dovish tone, New York Fed President John Williams said a rate reduction was under consideration, echoing Chair Powell's remarks at Jackson Hole. Meanwhile, Asian demand stayed firm, with China's net gold imports via Hong Kong surging 126.8% in July from June, more than doubling month-on-month.
Source: Trading Economics
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