On Thursday, gold prices experienced a notable decline following a modest downturn in the previous session. Gold for August delivery dropped significantly by $29.50, or 1.2%, to settle at $2,478.90 per ounce. This decline followed a slight dip of $2.90, or 0.1%, to $2,508.40 per ounce in the earlier session.
This marked the most substantial one-day decrease in both dollar and percentage terms in nearly a month, continuing the retreat from the record highs set on Tuesday. The sharp decline in gold prices was driven by a rebound in the value of the U.S. dollar. The U.S. dollar index increased by 0.5% to 101.53, recovering from a nearly eight-month low reached on Wednesday.
Additionally, rising treasury yields contributed to the pressure on gold prices as investors anticipated the Kansas City Federal Reserve's Jackson Hole Economic Symposium, starting later in the day.
Fed Chair Jerome Powell is scheduled to address the symposium in Jackson Hole, Wyoming, on Friday. Investors are keenly awaiting his comments for further insights into the central bank's monetary policy outlook.
Ahead of Powell's speech, the CME Group's FedWatch Tool indicated a 75.5% probability of a quarter-point rate cut next month, while there was a 24.5% chance for a half-point rate cut.
In terms of U.S. economic data, the Labor Department reported a modest increase in initial jobless claims for the week ending August 17th. The report showed initial jobless claims rose to 232,000, up by 4,000 from the previous week's revised figure of 228,000. Economists had anticipated claims to inch up to 230,000, compared to the originally reported 227,000 for the prior week.
Meanwhile, the National Association of Realtors revealed that existing home sales ended a four-month decline in July, with sales rebounding slightly more than expected.
