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Gold Falls Below $4,500 After Fed Chair Signals More Policy Tightening

Markets sharply repriced the chance of a September rate increase after Kevin Warsh’s Jackson Hole remarks, leaving near‑term direction dependent on upcoming U.S. data and the Fed meeting.

Overview

  • Global spot and futures gold slid into the mid-$4,300s–$4,500s per ounce following Kevin Warsh’s Jackson Hole comments, with several outlets reporting prices around $4,377–$4,567 and trading below roughly $4,500.
  • Warsh’s comment that there is “more work to do” on inflation pushed market odds of a September Fed rate hike to about 64–66 percent, and the stronger dollar and rising 10-year Treasury yields increased the cost of holding non‑yielding gold.
  • The international selloff passed quickly to local markets, where Pakistan’s association-reported rates fell by Rs1,800 on Aug. 31 and a further Rs800 on Sept. 1 to about Rs465,336 per tola, and India’s IBJA reported a drop of roughly Rs1,037 to Rs154,798 per 10 grams.
  • Analysts stressed that medium-term supports remain, citing central-bank purchases, renewed ETF inflows, recent M2 money‑supply growth and a persistent annual silver supply deficit that could limit downside or lift prices if physical demand returns.
  • Markets now await U.S. jobs and inflation releases and the September Fed decision for direction, while institutions offer wide year‑end forecasts that range roughly from $4,500 to $6,000 per ounce, reflecting high uncertainty in the next 12 months.