Gold Prices Slump to Two-Week Low as Silver Shines

Gold prices remain battered, touching their lowest level in two weeks.

Investors are weighing increased expectations that the US Federal Reserve will raise interest rates, following hawkish remarks from Fed Chair Kevin Warsh. A surge in oil prices has also reinforced inflation concerns.

According to Refinitiv data, gold closed at US$4,448.29 per troy ounce on Monday (31/8/2026), down 0.09%. That closing price was the lowest since 18 August 2026.

Monday’s decline extended gold’s slump to 3.32% over the past two trading days.

Gold remained under pressure on Tuesday (1/9/2026), easing 0.04% to US$4,446.66 per troy ounce.

Despite the pressure, gold still recorded its strongest monthly gain since January 2026, having risen around 10.08% during August 2026.

Daniel Pavilonis, Senior Market Strategist at StoneX, said the pressure on gold stemmed mainly from rising interest rates and inflation expectations triggered by higher energy prices and falling oil inventories.

“US yields continue to strengthen and the dollar is also strengthening. This puts gold in a fairly vulnerable position,” he said, as quoted by Refinitiv.

The US dollar also held near its highest level in two weeks. However, a slight softening of the dollar helped limit gold’s decline.

Gold had previously plunged more than 3% on Friday, its biggest daily drop since 10 June. The decline came after Warsh signalled at the Jackson Hole symposium that the Fed may need to take further action if inflation does not return to its 2% target.

Based on the CME FedWatch Tool, market participants now see a roughly 64% chance of a 25 basis point rate hike in September, up sharply from around 36% before Warsh’s remarks.

The market now awaits US ADP employment data and nonfarm payrolls due this week for clues on the state of the economy and the direction of Fed policy.