Gold prices drop as US producer prices rise
Gold prices dipped a bit this week, with spot gold down 0.1% to $3,333.58 per ounce—marking a 1.9% weekly loss.
The drop comes after stronger-than-expected US inflation data made investors rethink the chances of Federal Reserve rate cuts.
Explanation behind gold's dip
Rising US producer prices (up 3.3% in July vs the 2.5% forecast) are making interest rate cuts less likely, which hurts gold's appeal since it doesn't pay interest like other investments.
With Treasury yields climbing and the dollar getting stronger, some investors are looking elsewhere for returns.
Other precious metals' performance this week
All eyes are now on Fed Chair Jerome Powell's upcoming Jackson Hole speech for clues about future rates—which could shake up gold prices again.
Meanwhile, investor caution is showing: the world's biggest gold ETF just saw its holdings shrink by 0.3%.
Silver edged up slightly, but platinum and palladium slipped alongside gold.