Precious Metals Market Recap, August 27, 2026: Gold Moves Sideways, Silver Gains After Inflation Report

Precious Metals Market Recap, August 19, 2026: Gold Sets Multi-Month High as Silver Surges

(Aug. 27th, 2026) – Gold moved sluggishly on Thursday, adding just over $12 per troy ounce. Silver showed a stronger performance, adding more than $1.10/ozt one day after a fresh inflation reading with the July Personal Consumption Expenditures (PCE) report. Inflation remained sticky throughout July, the report found, ticking 0.2% higher against a forecasted 0.1% increase. Year over year, consumer prices have risen 3.7%, outpacing the median forecast of 3.6%. This reading could play a major role in the FOMC’s decision as it meets in September to discuss interest rates. The gold-silver ratio pulled back on Thursday due to silver’s strong performance relative to gold.

Thursday’s price action drove silver to approximately $69.34/ozt, its highest price since June 16th. Gold prices also remained elevated at approximately $4,610.75 per troy ounce at market close, although the spot price of gold has retreated from Tuesday’s multi-month high of $4,658.44/ozt. Both precious metals have been driven this year by a combination of interest rate speculation and uncertainty surrounding the US-Iran conflict. Both of these factors are expected to remain major price motivators heading into September.

Interest cut speculation drove much of gold’s historic run in 2025, but 2026 had seen interest rate hike speculation take a backseat to geopolitical signals until rising inflation changed market expectations to account for a likely hike by the end of the year. The Federal Open Market Committee (FOMC) uses rate cuts to bolster the job market, but rate hikes are primarily used to slow inflation and lower consumer prices. The FOMC voted to leave rates unchanged during a tense July meeting that saw several dissenting votes. Board members Beth M. Hammack, Neel Kashkari, and Lorie K. Logan all voted to raise interest rates by 25 basis points.

The key to the controversy at the Federal Reserve has to do with a combination of sticky inflation and signs of a slowing labor economy. July’s unemployment report saw a drop of 23,000 nonfarm payroll jobs, far below expectations. Overall labor force participation also retreated, falling to 61.4%. Meanwhile, recent inflation reports have suggested that consumer prices may not be coming down. Because raising rates raises borrowing costs for businesses, an interest rate hike runs the risk of worsening the U.S. job market. Likewise, cutting rates to bolster employment would drive inflation higher, meaning that the Fed is left with two options: keep rates unchanged or raise rates.

It is a sticky position, and it’s also one that could potentially impact the precious metals market. Non-interest-bearing assets like gold and silver tend to thrive when rates are falling due to both the possibility of inflation and retreating gains among interest-bearing assets. Conversely, rate hikes can drive demand for safe haven assets lower, since raising rates drives investors to interest-bearing assets and falling inflation hurts the appeal of inflation-resistant assets like gold and silver. Needless to say, precious metal investors are watching the U.S. central bank closely as it prepares for the Sept. 15th FOMC meeting.

Wednesday’s inflation reading had little effect on interest rate expectations, particularly at the Fed’s September meeting. CME FedWatch finds a 36% probability that the FOMC will vote to raise interest rates in September and a 64% likelihood that rates remain unchanged for another month. This is up just 0.1% from last week. A large shakeup in market expectations happened for the December meeting. The odds of a no-change call at that December meeting dropped from 33% one week ago to 25.6% today. Interestingly, most of the shifting odds came from predictions of two or three cuts occurring, with single-cut call odds remaining largely unchanged (45% last week to 45.2% on Thursday). CME FedWatch’s projection of two 25-point rate hikes by the end of 2025 jumped from 19.5% last week to 24.9% on Thursday, while the probability of three cuts increased from 2.6% one week ago to 4.3% on Thursday.

Tomorrow, Federal Reserve Chair Kevin Warsh will deliver his first speech at the Jackson Hole economic policy symposium since taking office in May. Historically, the keynote speech delivered by the sitting Federal Reserve Chair has provided key insights to economists about where economic policy may be heading. Expect considerable movement in interest rate expectations, depending on what Mr. Warsh has to say about forward-thinking policy. Gold and silver prices could react, but these impacts would be downstream from a larger market reaction to the evolving interest rate landscape. 

Of course, traders will continue to eye US-Iran negotiations throughout the coming months. The United States and Iran are locked in a tricky economic stalemate, with the U.S. executing a costly blockade of Iranian ports and Tehran refusing to open the Strait of Hormuz, a vital waterway through which an estimated 25% of the globe’s annual crude oil supply flows. Crude oil futures are up by more than 6.7% this month and more than 53.7% since January 1st.

On Thursday, Iranian news outlets reported that Iran plans to temporarily allow more traffic through the Strait of Hormuz on the condition that the United States removes its blockade and acknowledges its previous Memorandum of Understanding (MoU), which ran for 60 days and expired this month.

Throughout 2026, developments along the Strait of Hormuz have exerted short-term pressure on the precious metals market. Contrary to market expectations, gold prices actually fell after the onset of the US-Iran conflict, largely due to the United States dollar gaining strength and inflation fears driving expectations that the Fed will raise interest rates. Since then, prices have fluctuated considerably, with gold in particular reacting to Iran news in the short term while reserving larger price trends for developments in the U.S. interest rate landscape.

We’ve got two big things to look for heading into the weekend. First is tomorrow’s Jackson Hole speech by Chair Warsh. This speech could have major implications for interest rate speculation heading into September, where the Fed faces a critical decision with potential downstream effects for safe haven demand. Second, more news out of Iran could exercise a more acute impact on safe haven demand, especially if Tehran confirms a move to reopen the Strait of Hormuz in some major capacity.

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