Gold ended the latest trading week under pressure from interest rates and the dollar. Wednesday’s US inflation release and Friday’s jobs report will provide fresh evidence for assessing the prospect of another Fed rate increase.
US inflation data are the next focus for gold after a losing week. A KUNA report carrying Dar Al-Sabaik’s September 27 assessment put the metal’s close for the trading week ended September 25 at about $4,285 an ounce. The weekly decline approached 2%, with a stronger dollar and higher US Treasury yields contributing to selling pressure.
Rate expectations challenge gold
The question now is whether the Fed will follow its September move with another increase. In its September 16 decision, the central bank raised its target range by 25 basis points to 3.75%–4%, citing inflation that remained elevated.
The rate projections released that day show 12 of 18 participants judging 4.125% appropriate at year-end, four choosing 4.375% and two choosing 3.875%. Those figures represent target-range midpoints. Sixteen projections above the current midpoint help explain why another increase remains in focus, but do not settle the outcome of the next meeting.
Fed Chairman Kevin Warsh also declined to commit to future decisions at his September 16 press conference. The official transcript records him saying:
“I’m not going to prejudge any future decisions we make.”
For gold, which pays no interest, higher bond yields can make an alternative investment more attractive. Nominal rates alone do not tell the full story, however: the real interest rate, adjusted for inflation expectations, changes the comparison. A strong inflation reading is therefore not automatically supportive for gold.
The Fed’s remarks following the decision are available in its September 16 press conference recording:
Inflation on Wednesday, jobs on Friday
The BEA’s official schedule sets the August personal income and outlays report, including the PCE price index, for Wednesday, September 30 at 8:30 a.m. Eastern. The core measure, which excludes food and energy, will also help assess how broadly price pressures are spreading.
The other major release is the September jobs report, scheduled by the Bureau of Labor Statistics for Friday, October 2, also at 8:30 a.m. Eastern. Employment and wage developments will add evidence on how the US economy is bearing higher interest rates alongside the inflation picture.
Reporting period and release date differ: Wednesday’s PCE figures cover August. The $4,285 figure in this report refers to the previous week’s close, not a live September 28 quote.
Separating forecasts, actual readings and revisions will matter when interpreting the response. For gold on the commodities agenda, the test is how changes in inflation feed into the dollar and Treasury markets.
