Top Stories This Week: Gold Above US$2,500 as Powell Signals Rate Cuts, Kazatomprom Lowers Guidance

Gold reached yet another record high at the end of last week, crossing US$2,500 per ounce for the first time.

The yellow metal stayed above that key level until experiencing a pullback on Thursday (August 22), but breached US$2,500 again on Friday (August 23) morning. Gold is seeing support from quickly increasing confidence that the US Federal Reserve will cut interest rates at its next gathering, which is scheduled for September.

The central bank's July meeting minutes, released on Wednesday (August 21), show the "vast majority" of participants believe it will be appropriate to do so if economic data continues to show inflation is declining.

A major revision to US jobs data has also added fuel to the rate cut fire.

On Wednesday, the Bureau of Labor Statistics said employers in the country added 818,000 fewer jobs in the year ended this past March. That means job growth averaged 174,000 a month during that period, not 242,000 as originally outlined. The downward update was expected and could also be revised, but if it holds it will be the largest since 2009.

The icing on the cake was Fed Chair Jerome Powell's talk at the Jackson Hole Economic Symposium on August 23. During the much-anticipated speech, he said the time has come for policy to adjust — while as usual he didn't provide details on the exact timing or extent of the cuts, he emphasized that the direction of travel is clear.

“The time has come for policy to adjust. The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook and the balance of risks,” he said.

Powell also said the balance of risks to the Fed's dual mandate has changed — with inflation now "significantly" down, its attention is shifting to ensuring that the labor market stays strong.

The Fed's next meeting is set to run from September 17 to 18.

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