Gold prices edged lower on Friday as investors waited for comments from US Federal Reserve Chairman Kevin Warsh for clues about interest rates and the direction of monetary policy.
The metal fell as much as 0.6% during the session before trading near $4,160 an ounce. This followed its biggest one-day gain in more than two weeks during the previous session.
Warsh was scheduled to speak at an International Monetary Fund meeting in Bangkok at 10:30 a.m. local time. His remarks came ahead of the period when Federal Reserve officials stop making public comments before their October 27–28 policy meeting.
Justin Lin, an analyst at GlobalXETFs, said investors were looking for signs of a possible interest rate increase this month. He noted that if Warsh takes a more hawkish position, $4,000 an ounce could become an important level for gold traders to watch, especially given recent investment flows into gold-backed exchange-traded funds around that price.
Gold has faced pressure from rising borrowing costs because it does not pay interest. The metal has lost about one-fifth of its value since the war between the United States and Iran began in late February, as energy market disruptions and inflation concerns have affected financial markets.
Rising inflation has also strengthened expectations of tighter monetary policy. The Federal Reserve’s rate increase last month, its first since 2023, added further pressure on gold.
The metal received some support on Thursday when technology stocks fell amid concerns about the scale of investment in artificial intelligence. Investors moved toward bonds, pushing yields lower and making gold more attractive.
However, pressure on technology stocks eased during Friday’s trading, while US Treasury yields edged higher. These moves limited gold’s recovery.
Gold was heading toward a weekly loss of around 0.7% following the release of US economic data for September. Inflation came in higher than expected, while producer prices and retail sales figures also strengthened expectations that the Federal Reserve could raise interest rates in October.
At 10:40 a.m., spot gold was down 0.2% at $4,164.34 an ounce. Silver rose 0.3% to $57.58 an ounce.
Platinum and palladium also recorded small gains, while the Bloomberg Dollar Spot Index edged slightly higher after falling 0.3% in the previous session.
