Gold price slips for sixth day as traders await rate hike path cues

Investors sought haven in the greenback amid a risk-off mode in the broader financial markets, with the US equities retreating and the benchmark 10-year Treasury yield above 3%. A stronger dollar and higher bond yields are bad for bullion as it pays no interest and is priced in the US currency.

All eyes will be on Chair Jerome Powell when he speaks Friday at the annual gathering of central bankers at Jackson Hole. He is expected to re-state the Fed’s resolve to keep raising rates to get inflation under control, though he’ll probably stop short of signaling how big officials will go when they meet next month.

“The market will be looking for Chair Powell to push back on pivot talk amid the notable easing in financial conditions sparked by his last remarks, and to instead provide a clear message that the Fed will need to get restrictive,” TD Securities commodity strategists led by Bart Melek said in a note. “Should Powell meet these expectations, market pricing for rate cuts should subside, suggesting speculative appetite in precious metals could dry up even further.”

Spot gold fell as much as 1.1% to $1,727.84 an ounce, the lowest intraday level since July 27, and traded at $1,736.54 as of 1:56 p.m. in New York. Bullion for December delivery slipped 0.8% to settle at $1,748.40 on the Comex. The Bloomberg Dollar Spot Index rose 0.6%. Spot silver, platinum and palladium declined.