Gold prices are down again Wednesday morning. The markets are taking a break in anticipation of a hectic week filled with U.S. economic reports. The key U.S. data highlight of the week will be the monthly employment situation report from the Labor Department, scheduled for release by Friday morning. The price of gold is trading at $2,489.79, down $3.12. The price of silver is trading at $28.14, up 9 cents.
In August, major asset classes experienced significant gains, driven by expectations of a Federal Reserve pivot and following an early-month decline in the S&P500. Gold prices reached all-time highs but retraced slightly by month-end, while silver saw a small loss. Palladium prices increased as some car companies delayed electric vehicle rollouts, but platinum prices decreased. At the Jackson Hole symposium, Fed Chair Powell announced the end of the pause in rate hikes, citing confidence in inflation’s path but concerns about job growth.
Looking ahead, upcoming unemployment data could influence the Federal Reserve’s decision on interest rate cuts at their September meeting. The presidential debate may focus on candidates’ plans to manage federal debt, especially following Fitch’s downgrade of the US a year ago. Historically, stock prices have been an indicator of election outcomes, with incumbent parties losing in soft markets. Gold prices have typically benefited from lower interest rates, as evidenced by returns following the last eight rate cut cycles.
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