Gold ground higher this week, hitting a two-month high near $4,412 Tuesday. Then it wobbled โ cooler PPI data Thursday actually hurt the rate-cut trade, before a surprise retail sales drop Friday pulled September hike odds down to about a third. The wildcard all week: the Strait of Hormuz, where tanker attacks and hardening Iranian rhetoric kept oil elevated despite cooling inflation. Next week's quiet on data, but the FOMC's July minutes Wednesday matter โ our first real look at how split that 9-3 vote was, now that a weak jobs report and two months of cooling inflation have landed since.
๐ก Monday (8.10.26): Gold $4,358.71 ยท Silver $65.11. Metals held their bid even as Friday's payroll-shock relief trade partly faded โ oil jumped as Iran's tougher stance on Hormuz reopening revived inflation concerns, pushing September hike odds back up to 51.7% from 44.4%. Moral: the labor market gave gold a reason to rally, and by Monday, oil was already trying to take it back.
๐ต Tuesday (8.11.26): Gold $4,412.50 ยท Silver $65.68. Gold pushed to a fresh two-month high as Iran's newly appointed security chief hardened the Hormuz standoff and Trump added a new demand for compensation โ Brent settled near $89, keeping inflation risk elevated heading into Wednesday's CPI report. Moral: every time a resolution looks close, someone adds a new condition.
๐ข Wednesday (8.12.26): Gold $4,406.20 ยท Silver $65.14. Gold tested two-month highs as a cooler-than-expected CPI print (0.1% monthly, 3.4% annual) pulled September hike odds down to around 40% and eased yields โ though the IEA's warning about rapidly depleting oil inventories kept a lid on the rally. Moral: good inflation news and bad oil news canceled out to a "pretty good" day.
๐ฃ Thursday (8.13.26): Gold $4,349.80 ยท Silver $64.29. The four-day advance finally broke as a flat PPI print pulled hike odds down further to 34.6%, but falling yields this time worked against gold rather than for it โ cheaper borrowing costs reduced the urgency for an inflation hedge just as oil fell alongside it. Moral: sometimes good news for the economy is bad news for gold's own trade.
๐ Friday (8.14.26): Gold $4,376.40 ยท Silver $64.74 (as of Friday morning) Metals rebounded after July retail sales unexpectedly fell 0.6% against expectations for a 0.1% gain, pushing September hike odds down to roughly 32-33% from near 50% a week ago โ though two UAE tankers attacked in the Strait of Hormuz and Brent near $88.50 kept a lid on how far gold could run. Moral: the consumer just handed gold one more reason to believe the Fed's done โ but the Gulf isn't cooperating with a clean story either way.
Cooler Inflation Data Just Handed the Fed a Problem It Didn't Want
The big picture
Gold broke out and held above $4,350 this week after two straight months of cooling CPI and PPI data โ but economists say the Fed's actual thinking is more complicated than markets are pricing.
Driving the news
- Wednesday's CPI came in reassuringly in-line, followed by a benign PPI print Thursday โ both readings cooler for a second straight month.
- Three-month annualized core inflation is now down to just 1.6%.
- Markets are now pricing only a 40% chance of a September hike, down from 27bps of priced tightening in late July to just 10bps now.
- Gold ETFs saw $3 billion of inflows in July, snapping two straight months of outflows.
Why it matters
Economists are split: some see this as the Fed's cue to stay firmly on hold through 2027, while others โ like KPMG's Diane Swonk โ warn service-sector inflation remains sticky enough that hawks on the committee won't fully stand down, especially with one more CPI print due before the September meeting.
What to watch
Whether August's CPI and PPI data (due before the September 16 FOMC meeting) confirm this cooling trend or reverse it โ plus the Jackson Hole symposium, which falls in between.
The bottom line
Moral: two good inflation reports in a row is progress, not a victory lap โ the Fed's still waiting to see if the third one agrees.
UBS Sees Gold Testing $5,000 by Next Summer
The big picture
Having just broken out of a two-month trading range above $4,250, gold has UBS's attention โ and the bank thinks the move has real legs into 2027.
Driving the news
- UBS expects gold to challenge $5,000/oz in the first half of 2027, driven by falling real rates, a softer dollar, and sustained sovereign demand.
- Central banks bought 289 tonnes of gold in Q2 alone, with UBS projecting 750-1,000 tonnes for the full year.
- The bank flags Chinese institutional buying and the recent US-Japan yen intervention as having directly supported this month's breakout.
- UBS still sees near-term risk if U.S. data stays firm or oil keeps inflation worries alive โ and even suggests dips toward $4,000 could be buying opportunities.
Why it matters
A bank moving from defense (UBS cut its 2026 forecast from $5,900 to $5,500 back in May) to actively framing pullbacks as entry points is a meaningful shift in tone from one of the more cautious major banks on gold this year.
What to watch
Whether central bank buying data for Q3 confirms UBS's 750-1,000 tonne full-year estimate, and whether the dollar's structural weakness thesis actually plays out.
The bottom line
Moral: even the bank that got more cautious in May is now telling clients to buy the dips.
A Technical Signal Says the Dollar Has Much Further to Fall
The big picture
One veteran market technician says the chart pattern behind this month's dollar selloff points to significantly more downside ahead โ which would be a direct tailwind for gold.
Driving the news
- Tom McClellan notes the Dollar Index fell back below its 100.50 support/resistance level following the coordinated US-Japan yen intervention, marking a failed breakout.
- Commodity Futures Trading Commission data shows commercial traders actually increased their net short position on the dollar this week โ a pattern McClellan says has historically preceded further declines at prior tops.
- Separately, US Strategic Petroleum Reserves have dropped to their lowest level in nearly 50 years, with 117 million barrels released since the Middle East war began.
- Global shipping costs are also climbing again, with the Shanghai-New York container route up 164% year-to-date.
Why it matters
A weaker dollar is one of gold's most reliable tailwinds, and a technical setup suggesting the move is still early โ rather than already priced in โ adds to the bull case building across several fronts this week.
What to watch
Whether the commercial short position McClellan flagged continues to build, and whether shipping-cost inflation feeds into the CPI readings the Fed is watching closely.
The bottom line
Moral: when the people usually betting against a trend start betting against it harder, that's not exhaustion โ that's a signal.
China's Gold Buyers Are Switching From Jewelry to Bars
The big picture
China's overall gold consumption ticked up slightly in the first half of 2026 โ but the composition of that demand shifted dramatically, with investment demand picking up nearly all the slack from a collapsing jewelry market.
Driving the news
- Total consumption rose 1.23% to 511.41 tonnes in H1, per the China Gold Association.
- Jewelry demand plunged 33.88% as high prices kept consumers on the sidelines.
- Gold bar and coin demand jumped 28.42% to 339.34 tonnes, as periodic price pullbacks repeatedly drew in investment buyers.
- Domestic mine output fell 14.62% due to safety-related production halts, even as imported-material production rose.
Why it matters
A shift from jewelry to bars and coins signals Chinese buyers increasingly treating gold as a monetary asset rather than a consumer good โ reinforcing the same "de-dollarization" and reserve-diversification themes UBS and other banks are citing as long-term bull drivers.
What to watch
Whether major Chinese banks halting retail Shanghai Gold Exchange trading (which several did after the July 24 settlement) pushes even more retail demand toward physical bars, as one analyst interpreted the move.
The bottom line
Moral: Chinese buyers aren't slowing down on gold โ they're just trading in the necklace for the bar.
ECONOMIC CALENDAR
Monday, Aug. 17
- 8:30 am โ Empire State Manufacturing Survey (Aug.) โ prior: 15.6
Tuesday, Aug. 18
- 8:30 am โ Housing Starts (Jul.) โ prior: 1.427M
- 9:15 am โ Industrial Production & Capacity Utilization (Jul.) โ prior: 0.1% (cap. util.: 76.1%)
Wednesday, Aug. 19
- 2:00 pm โ FOMC Meeting Minutes published
Thursday, Aug. 20
- 8:30 am โ Philadelphia Fed Business Outlook Survey (Aug.) โ prior: 41.4
- 8:30 am โ Weekly Jobless Claims (Aug. 15) โ prior: 209K
- 10:00 am โ Leading Indicators (Jul.) โ prior: -0.2%
Friday, Aug. 21
- 9:45 am โ US Flash Manufacturing PMI (Aug.) โ prior: 53.9
- 9:45 am โ US Flash Services PMI (Aug.) โ prior: 54.6
A couple of notes on the links: Weekly Jobless Claims points to the DOL's standing weekly release PDF, evergreen as before. The rest link to their standing report/topic homepages since next week's individual release pages don't exist yet. FOMC minutes link to the Fed's standing meeting-calendar page, which will host the minutes once published.
IMPACT ON PRECIOUS METALS MARKETS
Empire State Manufacturing Survey
- Reading rises = New York factory activity accelerating, adds to the case the economy is shrugging off tariffs and oil = mild headwind for gold.
- Reading falls = regional manufacturing losing steam = tailwind for metals.
July's reading jumped to 15.6 from June's 5.7, a fourth straight month of expansion, though supply availability kept worsening and price pressures stayed elevated. A pullback here would be notable given how strong July's print was. Low to moderate impact.
Housing Starts
- Reading rises = homebuilding activity holding up despite elevated rates = mild headwind for gold.
- Reading falls = affordability and rate pressure weighing on construction = tailwind for metals.
June starts jumped 19% to 1.427 million, but the gain was driven almost entirely by volatile multi-family construction โ single-family starts actually slipped for a third straight month. July's reading will show whether that multi-family rebound holds or reverses. Low to moderate impact.
Industrial Production & Capacity Utilization
- Reading rises / capacity utilization climbs = factories running hotter, economy absorbing tariffs and oil costs = mild headwind for gold.
- Reading falls = industrial activity cooling = tailwind for metals.
June's output ticked up just 0.1%, with manufacturing output flat and capacity utilization steady at 76.1%, still well below its long-run average. A weak July print would reinforce the "steady but unremarkable" read on the industrial economy. Low to moderate impact.
FOMC Meeting Minutes
- Minutes reveal more hawkish committee tone / discussion of additional hikes = headwind for gold.
- Minutes reveal a more cautious, data-dependent committee = supportive for gold.
The July 29 decision was a 9-3 split, with Hammack, Kashkari, and Logan all pushing for an immediate hike โ these minutes are the first chance to see the actual internal debate behind that vote, especially in light of the weak July jobs report that arrived after the meeting. High impact.
Philadelphia Fed Business Outlook Survey
- Reading rises = regional manufacturing sentiment strengthening = mild headwind for gold.
- Reading falls = manufacturing momentum fading = tailwind for metals.
July's reading exploded to 41.4 from a much lower June level, its highest since November 2021, with new orders and shipments both hitting multi-year highs. Given how sharp that jump was, a pullback toward more normal levels wouldn't be surprising and shouldn't necessarily be read as a reversal. Moderate impact.
Weekly Jobless Claims
- Claims rising = labor cracks continuing to widen after the weak July jobs report = good for metals.
- Claims falling back toward the lows seen earlier this summer = labor market re-tightening = mild drag on metals.
Claims have been drifting higher, from July's 57-year low of 187K up to 199K for the week ending Aug. 1 โ right before July's payrolls came in negative. Whether claims confirm that labor-market softening or stabilize is the key thing to watch. Moderate to high impact given last week's jobs shock.
Leading Indicators
- Reading turns positive = forward-looking growth signals improving = mild headwind for gold.
- Reading stays negative = continued signs of slowing ahead = tailwind for metals.
June's LEI fell 0.2%, reversing April and May's gains, dragged down by weak consumer expectations and a drop in building permits โ though the index's overall six-month decline has been much milder than last year's stretch. Moderate impact.
US Flash Manufacturing PMI
- Reading rises = factory activity accelerating = mild headwind for gold.
- Reading falls = manufacturing losing momentum = tailwind for metals.
July's final reading held at 53.9, matching June, marking a full year of expansion โ though the report flagged softer production and sales growth beneath the headline number, plus the steepest drawdown in finished-goods inventories since 2023. Low to moderate impact.
US Flash Services PMI
- Reading holds near multi-month highs = the dominant, consumer-facing part of the economy still expanding solidly = mild headwind for gold.
- Reading rolls over = growth engine losing steam, especially once World Cup-related spending fades = tailwind for metals.
July's final reading surged to 54.6, a nine-month high, though S&P Global explicitly flagged this as partly driven by temporary World Cup and Independence Day spending โ a seasonal tailwind unlikely to repeat in August. This flash print is the first test of whether services growth holds without it. Moderate impact.
