Key HighlightsThe precious metal is hovering near a three-month peak at approximately $4,660 per ounce following a weekly surge exceeding 7%Declining crude oil prices combined with reduced US Treasury yields are alleviating inflation concerns, bolstering gold’s valueDiplomatic discussions between Iran and Oman focused on establishing a temporary maritime passage to reopen the Strait of HormuzMarket participants are closely monitoring Fed Chair Kevin Warsh’s upcoming Jackson Hole address on Friday for monetary policy insightsWednesday’s PCE inflation release will provide traders with additional perspective on the US economic landscapeThe precious metal experienced a modest pullback on Wednesday while maintaining proximity to its three-month peak, buoyed by declining crude prices and softer Treasury yields that have diminished inflation worries.Spot gold traded near $4,660 per ounce, with futures contracts climbing slightly to $4,699. Silver advanced 0.7% to reach $69.05, while platinum posted a 0.3% increase.Gold Dec 26 (GC=F)The yellow metal has climbed more than 7% during the previous week, a surge partially attributed to the US Treasury’s decision to accelerate buybacks of longer-dated government securities.This initiative has reignited what market participants refer to as the “debasement trade,” where investors acquire gold as a hedge against fiscal deficits and currency depreciation. This strategy contributed to gold’s unprecedented rally in 2025 and has returned to prominence.Crude Price Decline Eases Fed PressureOil prices retreated on Tuesday following diplomatic discussions between Iran and Oman regarding the establishment of a temporary shared maritime passage that could facilitate renewed shipping activity through the Strait of Hormuz.Crude price movements are significant for gold because energy expenses directly influence inflationary pressures. When crude costs decline, inflation typically moderates, diminishing the necessity for the Federal Reserve to maintain elevated interest rates.Elevated interest rates typically act as a constraint on gold since the metal generates no yield. When rates remain high, income-producing assets become comparatively more appealing.Treasury yields declined by approximately five to seven basis points throughout the curve on Tuesday, providing additional upward momentum for gold prices.Boston Fed President Susan Collins indicated her support for maintaining current rate levels, provided inflation continues its trajectory toward the Fed’s 2% objective.Market Attention Shifts to Jackson Hole and PCE ReleaseMarket participants are focused on two critical upcoming events that could influence gold’s trajectory in the immediate term.The first is Wednesday’s US Personal Consumption Expenditures report. The PCE serves as the Fed’s primary inflation metric and will deliver updated insights into price dynamics within the economy. REMINDER: US PCE INFLATION DROPS TODAY AT 8:30 AM ET!Previous: 3.7% · Forecast: 3.6%IF PCE > 3.6% → risk offIF PCE < 3.6% → risk onLast inflation print before Kevin Warsh speaks at Jackson Hole on Friday. pic.twitter.com/Jn9GCjhwWR— Crypto Rover (@cryptorover) August 26, 2026The second is Friday’s Jackson Hole symposium, where Fed Chair Kevin Warsh will present his inaugural major address since assuming his position.Warsh has encountered criticism for not articulating his economic perspectives clearly. Market observers are anticipating Friday’s speech will provide enhanced clarity regarding the Fed’s stance on potential rate reductions.ANZ analysts observed that Treasury Secretary Scott Bessent offered no fresh indications regarding debt management strategies, though market reports indicate the Treasury may utilize cash reserves to repurchase older, higher-yielding securities.The US Dollar Index remained relatively unchanged at 99.01, holding steady following a minor decline in the prior session.Gold’s immediate price trajectory will likely be determined by the signals emerging from the PCE data release and the content of Warsh’s address concerning inflation trends and Federal Reserve policy direction.The post Gold Hovers at 3-Month Peak Amid Declining Oil and Treasury Yields appeared first on Blockonomi.