Gold advances as Powell opens door for rate cut in September

Federal Reserve Chair Jerome Powell (Courtesy: Reuters photo)

Gold advanced as the dollar pushed lower after Federal Reserve Chair Jerome Powell carefully opened the door to an interest-rate cut in September, pointing to rising risks for the labor market even as worries over inflation remain.

“The stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance,” Powell said Friday in remarks prepared for the Fed’s annual conference in Jackson Hole, Wyoming. “Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.”

Traders added to bets on the US central bank’s rate cut next month as Powell delivered his speech. Bullion typically benefit in a lower rate environment.

Gold rose 0.6% to $3,359.00  an ounce as of 10:10 a.m. in New York. The Bloomberg Dollar Spot Index declined.