Full Breakdown
Gold’s Late-August Rally and Pullback: Inflation Data, Treasury Buybacks, and Middle-East Tensions
8/26/2026, 8:06:28 PM
Core Market Move (August 24-26)
- August 24 – Spot gold rose to a three-month high of $4,680.70, closing at $4,639.49.
- August 25 – Prices moved above the 200-day moving average, hitting $4,676.75 in early trading.
- August 26 – Gold slipped 1.3% to $4,594.84; U.S. gold futures fell 0.9% to $4,650.90.
Background & Context
The rally was triggered by two policy actions. The U.S. Treasury announced a doubling of its long-term bond buyback program, a move seen as weakening the dollar and boosting demand for non-yielding assets. Markets also awaited the Personal Consumption Expenditures (PCE) price index for July and the inaugural speech of new Fed Chair Kevin Warsh at Jackson Hole.
Geopolitical tension persisted as Iran’s Revolutionary Guards warned the Strait of Hormuz would stay closed without U.S. concessions, while the Trump administration announced new tariffs on Canadian cars and raw materials and expanded secondary sanctions on Iran-linked entities.
Data & Statistics
- PCE index: 3.7% YoY increase through July, versus a 3.6% forecast.
- Rate-hike odds: CME FedWatch Tool showed a 38% probability of a Fed hike next month, with a 62% chance of rates staying unchanged.
- Gold-related flows: World Gold Council reported $6.381 billion inflows into gold ETFs the week ending Aug 23; the SPDR Gold Trust added nearly 50 tons in one month.
- Other metals: Spot silver fell 1.1% to $67.91; platinum dropped 1.2% to $1,837.78; palladium slipped 0.1% to $1,325.10.
Official Statements & Responses
- Iranian Revolutionary Guards: Stated the Strait of Hormuz would remain closed without U.S. acceptance of their terms.
- President Donald Trump: Announced new tariffs on Canadian automobiles and critical raw materials.
- IMF Managing Director Kristalina Georgieva: Said the global economy had weathered the Iran-related energy shock better than expected, while warning of deteriorating fiscal conditions in some countries.
- Susan Collins, Boston Fed President: Supported keeping rates unchanged provided inflation moves toward the 2% target.
Conflicting Reports & Gaps
- Spot gold price levels differ across outlets for the same dates: $4,594.84 (Reuters, Aug 26), $4,642.74 (Business Times, Aug 25), $4,676.75 (Biggo, Aug 25), and $4,639.49 (Business Times, Aug 24).
- Rate-hike probability is reported as 38% versus a 61.6% chance of no hike, reflecting methodological differences in CME FedWatch calculations.
Verbatim Quotes
- “Gold's price action up to today's data was just some profit taking ... PCE data came in largely in line with expectations, so we're consolidating within yesterday's range at this point,” — Peter Grant, Zaner Metals
- “I think the uptrend in gold is beginning to reassert itself. So I do see potential back above $5,000 this year,” — Peter Grant, Zaner Metals
- “The gold rally still has room to continue,” — Citi
What's Next
- August 28 – Fed Chair Kevin Warsh will deliver his debut speech at the Jackson Hole Global Central Bank Annual Meeting.
- September – The U.S. Congress is expected to vote on the CLARITY Act, which would establish a regulatory framework for digital assets.
- Upcoming PCE release – The July PCE index will be published later in the week, providing further guidance on inflation trends and potential Fed policy adjustments.
