(Kitco News) – The gold market is seeing significant selling pressure as Federal Reserve Chair Kevin Warsh reiterates his commitment to bringing inflationary pressures back in line with the central bank\u2019s 2% target.<\/p>\n
Friday, in his much-anticipated speech at the annual Central Bank Symposium in Jackson Hole, Wyoming, Warsh said that the price-stability side of the Federal Reserve\u2019s mandate is more of a concern than the slowing labor market.<\/p>\n
\u201cThere are always areas of concern in the labor market\u2014for example, among recent graduates. In general, though, people who want to work, by and large, are holding or finding jobs. They may well be concerned about possible future labor disruptions, but as of now, I believe the labor markets are consistent with full employment,\u201d Warsh said in his speech. \u201cBut on the price-stability side of our mandate, the numbers are more concerning. The Fed’s preferred measure of inflation, the 12-month change in the PCE price index, stands at 3.7 percent, while the six-month change is 4.1 percent.\u201d<\/p>\n
\u201cWe must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do. That’s our job . . . our mandate . . . and our charge to keep,\u201d he added.<\/p>\n
Although Warsh provided no forward guidance on U.S. monetary policy, analysts noted that his focus on inflation suggests a tightening bias. Adam Button, Chief Currency Analyst and Managing Editor at investingLive.com, said that Warsh\u2019s comments signal that he is leaning toward a rate hike.<\/p>\n
The gold market is seeing solid selling pressure in its initial reaction to Warsh\u2019s comments. Prices have dropped well below $4,600 an ounce as markets once again start to price in a potential rate hike as early as next month.<\/p>\n
Spot gold last traded at $4,552.00 an ounce, down more than 1% on the day.<\/p>\n
Along with his optimistic views on the labor market, Warsh also struck a positive note on economic activity.<\/p>\n
\u201cCertain sectors\u2014like housing and agriculture\u2014are showing strains. But, on balance, I would be hard pressed to describe broad financial conditions as restrictive,\u201d he said. \u201cReal consumer spending has been healthy despite the shocks, increasing more than 2 percent over the past four quarters.\u201d<\/p>\n
Jeffrey Roach, Chief Economist for LPL Financial, said that Warsh\u2019s comments reinforced expectations that the central bank will maintain its tightening bias in an environment of shifting economic priorities.<\/p>\n
\u201cWe are entering a new era of monetary policy, one defined by less signaling, greater emphasis on real-time data, and a willingness to rethink economic first principles as AI reshapes the economy’s productive capacity. The distinctly hawkish speech gave support to the dollar as the chairman appears comfortable keeping policy higher for longer,\u201d he said.<\/p>\n
Disclaimer:\u00a0The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and\/ or damages arising from the use of this publication.<\/p>\n","protected":false},"excerpt":{"rendered":"(Kitco News) – The gold market is seeing significant selling pressure as Federal Reserve Chair Kevin Warsh reiterates…\n","protected":false},"author":2,"featured_media":599050,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[13286,13278,13282,1152,13277,4404,13280,13279,13281,12858,1247,42,13285,6453,13269,13287,13274,13288,13276,43,13271,13272,13270,13273,238,13275,13284,450,2796,13283,40,38,41,39,7549],"class_list":["post-599049","post","type-post","status-publish","format-standard","has-post-thumbnail","category-headlines","tag-bank-forecasts","tag-bitcoin-news","tag-central-banks","tag-charts","tag-crypto-news","tag-currency","tag-economic-reports","tag-ethereum-news","tag-forecasts","tag-global-economy","tag-gold","tag-headlines","tag-international-policy","tag-interviews","tag-kitco-news","tag-market-nugget","tag-metals","tag-mining-minutes","tag-mining-news","tag-news","tag-palladium","tag-pgm","tag-platinum","tag-platinum-group-metals","tag-politics","tag-precious-metals","tag-rare-earth-metals","tag-roundups","tag-silver","tag-tech-metals","tag-top-news","tag-top-stories","tag-topnews","tag-topstories","tag-us-dollar"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/599049","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=599049"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/599049\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/599050"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=599049"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=599049"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=599049"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}