Gold Price Analysis for August 26, 2024 – Intergold

Gold Price Status:
– Sethaput” Governor of BoT revealed that monetary policy activities are based on 3 factors “Inflation-Economy-Financial Stability”, pointing out that financial conditions are tight and its impact is stronger than expected. The policy is ready to adjust interest rates
– Summary of Jerome Powell's speech at Jackson Hole. “It's time to cut interest rates.”
1. Four and a half years after the arrival of Covid-19, the worst of the pandemic-related economic disruption is beginning to fade. The rate of inflation has come down significantly. The labor market is not so hot right now. Conditions are now less than they were before the COVID-19 pandemic. Supply constraints have returned to normal. The balance of risks to the central bank's parallel work has shifted.
2. Central Bank's objective is to restore price stability. Maintain the strength of the labor market and avoid sharp increases in unemployment. This is a characteristic of the earlier inflationary process. Inflation expectations have not been well compiled, although this work is far from complete but much progress has been made.
3. Tight monetary policy by the central bank helps restore balance between supply and demand. Help reduce inflationary pressures. and ensures that the expected inflation rate can be kept well. Inflation is now close to the target. “I have high confidence that inflation is on a steady path towards 2%.”
4. Overall, the economy continues to grow at a steady rate. But inflation and labor market data show a changing situation. Downside risks to inflation are diminishing. And as the FOMC highlighted in its latest report, downside risks to employment are rising. “We respect the risks on both sides of our parallel missions.”
5. It's time to adjust the policy. The direction is clear. But the timing and pace of interest rate cuts will depend on incoming data. Changing trends and risk balance
6. The central bank will do its best. Meanwhile, the central bank continues to build price stability to support a strong labor market. And there's good reason to think the U.S. economy will return to 2% inflation while maintaining a strong labor market through appropriate easing of policy restrictions. The current level of policy rates gives the central bank ample room to respond to any risks it may face, including the risk of an adverse weakening of labor market conditions.