Following the key speech by Federal Reserve Chairman Jerome Powell at the economic symposium in Jackson Hole, Wyoming, gold futures traded again and closed at a record high of $2,533.60.

The speech marked a shift in monetary policy, triggering a chain reaction across various financial sectors, including precious metals and the U.S. stock market.

Chairman Powell announced that "it's time to adjust policy," signaling an important turning point in the Fed's approach.

He noted that inflation has approached the Fed's 2% target while expressing concerns about the health of the labor market.

Powell emphasized that the current "labor market conditions are not as tight as they were before the pandemic in 2019, and inflation was below 2% in 2019."

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He further stated that the labor market seems unlikely to be the source of rising inflationary pressures in the near future, adding that he does not seek nor welcome further cooling of labor market conditions.

The financial community interpreted Powell's remarks as a clear sign that the Fed is preparing to begin a series of rate cuts.

Although no specific timetable was provided, market expectations for a rate cut at the upcoming Federal Open Market Committee (FOMC) meeting on September 18-19 are high.

The FedWatch tool at the Chicago Mercantile Exchange currently shows a 71.5% probability of a 25 basis point cut and a 28.5% chance of a 50 basis point cut.

In response to these developments, gold futures continued to rise, with the most active December contract reaching an intraday high of $2,561.20.

By late afternoon, it had settled at $2,553.60, up $4.90.

This upward trend occurred despite a slight strengthening of the dollar, with the U.S. Dollar Index rising 0.20% to 100.87.

The dollar's performance is noteworthy because it fell sharply by -0.83% on Friday, resulting in a weekly decline of 1.69%.

This brought the U.S. Dollar Index to its lowest value of the year.

Technical analysis suggests that the dollar may find support below the 100-point index, based on the July 2023 low.

The continued strength in today's gold prices indicates that despite the market's expectations for Powell's dovish remarks and partial digestion of the September rate cut, the full impact of these expectations has not yet been fully realized.

Today's modest price increase proves this point.

The gold market's reaction to Powell's speech and the subsequent expectations for policy changes highlight the complex relationship between monetary policy, economic indicators, and the valuation of precious metals.

As investors and analysts digest the implications of the Fed's potential monetary easing policies, the role of gold as a safe-haven asset and hedge against economic uncertainty appears to have been strengthened.

With the September FOMC meeting approaching, all eyes will be on the Fed's decision and any further guidance provided on the pace and extent of future rate cuts.

The coming weeks will be a critical period for gold prices and the broader financial markets as they adapt to the changing economic landscape and the major shift in the Fed's monetary policy announced by Powell.