International News 29 August 2025
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Gold Hits Five-Week High on Weaker Dollar, Fed Independence Concerns
Gold prices climbed to their highest level in five weeks on Thursday (Aug 28, 2025), supported by a weaker U.S. dollar and investor worries over the Federal Reserve’s independence. Spot gold rose 0.4% to $3,410.82 per ounce at 14:12 GMT, the highest since July 23, while U.S. gold futures for December delivery gained 0.6% to $3,468.30. The dollar slipped 0.4%, making gold more attractive for overseas buyers. Analysts noted that concerns about political pressure on the Fed, particularly from President Trump, raised expectations that the FOMC may cut rates sooner and keep them lower for longer—an environment supportive for gold. Markets are pricing in an 87% chance of a 25 bps cut at the Fed’s September meeting, according to CME FedWatch Tool. Silver also gained 1% to $38.97 per ounce, its highest since late July, with analysts seeing potential to break $40 if gold reaches fresh highs. Meanwhile, platinum edged down 0.1% to $1,346.51, and palladium rose 1.1% to $1,103.70. Investors now await Friday’s release of U.S. Personal Consumption Expenditures (PCE) inflation data for further cues on Fed policy. Despite a drop in weekly jobless claims, weak hiring trends suggest unemployment could rise to 4.3% in August, adding another layer of uncertainty to the outlook
Oil Prices Rise on U.S. Stock Draw and Trade Tensions with India
Crude oil prices closed higher on Wednesday (Aug 27, 2025) after U.S. data showed a larger-than-expected drop in crude inventories and as markets weighed the impact of new U.S. tariffs on India. Brent futures for October delivery rose 1.2% to $68.05 per barrel, while WTI gained 1.4% to $64.15. U.S. crude stocks fell by 2.4 million barrels to 418.3 million, exceeding expectations for a 1.9 million-barrel draw, according to the Energy Information Administration (EIA). Gasoline inventories dropped 1.2 million barrels, while distillate stocks fell 1.8 million barrels, defying forecasts for a build. Analysts noted that strong gasoline demand signals peak summer driving activity ahead of Labor Day. Beyond U.S. supply, traders are closely monitoring geopolitical risks. Washington doubled tariffs on Indian imports to 50% in response to India’s Russian oil purchases, raising concerns about broader economic impacts. Meanwhile, escalating attacks between Russia and Ukraine on energy infrastructure added to supply fears, though Russia simultaneously boosted export plans by 200,000 barrels per day from western ports. On the macro side, New York Fed President John Williams signaled that rate cuts remain likely, depending on upcoming economic data—a move that could support growth and oil demand by lowering borrowing costs.
Tokyo Core Inflation Slows but Stays Above BOJ Target
Tokyo’s core consumer inflation slowed in August but remained above the Bank of Japan’s 2% target, keeping expectations alive for further rate hikes. Core CPI, which excludes volatile fresh food but includes fuel, rose 2.5% year-on-year, down from July’s 2.9% and in line with forecasts. A narrower gauge, which strips out both fresh food and energy and is closely watched by the BOJ as a better measure of underlying inflation, climbed 3.0% in August after a 3.1% rise in July. The data reinforces the view that Japan is edging closer to achieving sustained inflation above target. The BOJ ended its decade-long massive stimulus last year and raised short-term interest rates to 0.5% in January. While Governor Kazuo Ueda has urged caution on further tightening given U.S. trade-related risks, persistent food inflation and the prospect of stronger wage growth have raised concerns among some policymakers about second-round price effects. A Reuters poll in August showed nearly two-thirds of economists now expect the BOJ to raise rates by at least another 25 basis points before year-end, up from just over half the previous month.
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