Gold Retreats From Three-Month High Ahead of Inflation Data, Fed Speech

Gold prices retreated from a three-month high on Tuesday, August 25, as investors paused to assess key economic data and a major speech from the Federal Reserve chair later in the week. The pullback followed a strong rally that had pushed the precious metal to its highest level since mid-May.

Spot gold fell 0.4% to $4,634.20 per ounce in early trading on August 25, after earlier touching a high of $4,677.19. Gold futures also declined, dropping 0.2% to $4,691.14. The retreat came after a significant surge last week, driven by a U.S. Treasury announcement to expand its buybacks of longer-dated government debt. That move sparked concerns about fiscal policy and the dollar's long-term value, sending bond yields lower and making gold, which pays no interest, more attractive to investors.

The market's focus has now shifted to two critical events. The Bureau of Economic Analysis is set to release its core personal consumption expenditures price index on August 27, a key inflation gauge watched by the Federal Reserve. On August 29, Fed Chair Kevin Warsh will deliver his first Jackson Hole speech as chair, which could provide crucial signals about the future path of interest rates.