Gold and Silver Sell-Off: Technical Breakdown and Fed Implications

Gold and silver sold off sharply today despite a weaker dollar. Gold dropped 3.24% while silver fell 4.38%. The dollar index declined 0.16% week-over-week to 118.06. This divergence points to technical exhaustion after a strong August rally rather than a macro-driven move.

Key Takeaways Gold fell 3.24% and silver 4.38% on August 31 despite a 0.16% drop in the trade-weighted dollar index. The 10-year yield held at 4.67% while the 2-year yield edged to 4.20%, keeping the spread positive at 47bps. CPI rose 0.07% month-over-month and PCE increased 0.16%, both consistent with the Fed's "last mile" plateau. The unemployment rate ticked down to 4.1% in July from 4.2%, supporting the Fed's patient st…