Gold slips to three-week low as dollar strengthens ahead of Fed meeting

WEB DESK: Gold prices edged lower on Wednesday, hitting their weakest level in almost three weeks, as a stronger dollar weighed on demand while investors waited for signals on future US monetary policy from the Federal Reserve’s Jackson Hole symposium later this week.

Spot gold slipped 0.1 percent to $3,313.51 per ounce at 0240 GMT, its lowest since August 1. US gold futures for December delivery also fell 0.1 percent to $3,355.50.

Dollar strength pressures bullion

The dollar index rose to its highest level in more than a week, making gold more expensive for holders of other currencies. Analysts said the firming dollar, along with improving risk sentiment after recent geopolitical developments, added to the downward pressure on bullion.

“Markets are largely waiting on Jerome Powell’s speech in Jackson Hole, and until then, gold is likely to stay under pressure from a stronger dollar,” said Kelvin Wong, senior market analyst at OANDA.

Powell is expected to deliver his remarks on Friday, with investors keen to see whether he hints at how soon rate cuts might begin. The minutes of the Fed’s July meeting, also due later on Wednesday, are expected to provide further clues on the central bank’s stance.

Interest rate futures currently signal two 25-basis-point cuts this year, with the first move likely in September. Gold often benefits when borrowing costs are lower, as it reduces the opportunity cost of holding the non-yielding asset.

Political backdrop

On the geopolitical front, US President Donald Trump on Tuesday ruled out sending ground troops to Ukraine but indicated that air support could be part of a potential deal to end the war. Ukrainian President Volodymyr Zelenskiy welcomed the talks in Washington as a “major step forward” that could pave the way for a trilateral meeting with Russian President Vladimir Putin and Trump.

Other precious metals

Among other precious metals, spot silver dropped 0.3 percent to $37.26 an ounce. Platinum rose 0.2 percent to $1,308.90, while palladium fell 0.7 percent to $1,106.83.

24-karat gold price in Pakistan

According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), gold prices in Pakistan slipped on Tuesday, following movement in the international market.

The price of 24-karat gold dropped by Rs1,100 to Rs356,600 per tola. The rate for 10 grammes of 24-karat gold also fell, down Rs943 to Rs305,727.

Meanwhile, 22-karat gold was being sold at Rs280,259 per 10 grammes after the decline.

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