Everbright Futures Gold Commentary 0901: Walsh's Aftershocks Combined with Oil Price Impact, Gold Remains Under Pressure

On August 31, COMEX gold traded sideways after yesterday’s pullback, closing at $4,497.3/ounce, down 0.72%. The domestic SHFE gold night session continued to hover around 960 points, closing at 959.84 yuan/gram, a decrease of 1.88%. Previously, impacted by hawkish statements from Federal Reserve Chair Walsh, spot gold plummeted over 3% in a single day, marking the biggest single-day drop since June 10. In just a few trading days, gold price has plunged from the phase high above $4,700/ounce on August 25 to below $4,500/ounce.

On the geopolitical front, the Iranian Foreign Minister said that the United States would only escape the current impasse by restarting the memorandum of understanding signed in June. However, tensions between the US and Iran have once again escalated in the Strait of Hormuz. A suspected supertanker was attacked by a naval mine and caught fire, with US and Iranian forces attacking each other. Geopolitical risks should have supported gold prices, but the market is instead pricing in the “geopolitics → oil price → inflation → rate hikes” transmission chain. Surging oil prices are boosting inflation expectations, and US Treasury yields are rising in tandem—the 10-year US Treasury yield climbed to near 4.75%, while the US Dollar Index stayed at a two-week high near 99.5. As a non-interest-bearing asset, gold continues to face pressure in a rising interest rate environment. Overall, with Walsh’s hawkish stance, escalating US-Iran tensions, and elevated oil prices, the topic of the Federal Reserve resuming rate hikes could become inevitable in September, possibly leading gold to remain cautious. However, the conflict between raising rates to suppress inflation and the rising yields on long-term US government bonds remains unresolved, so gold, as the ultimate credit hedge, may once again attract market attention. Therefore, gold’s short-term volatility and even corrections could increase, and the pace of releases of risk-negative events should be closely watched.

Source: Wind, Guangda Futures Research Institute

Written by: Shi Yueming

Professional Qualification: F03097365

Trading Advisory Qualification: Z0017563

Editor: Zhu Henan