Commodities Wrap 26 August: Gold Falls as US Inflation Data Lifts Rate Hike Bets While Wheat Hits a 52 Week High

By The Edge Research Team

Gold fell 1.00 percent to 4,647.50 dollars an ounce on Wednesday, a day after prices touched their highest level since 14 May, as United States inflation data came in slightly above forecast and lifted the odds of a Federal Reserve interest rate hike next month. Wheat moved in the opposite direction, surging 6.40 percent to a fresh 52 week high of 748.25 cents a bushel, a move Reuters linked to continuing disruption at Black Sea grain export terminals. Brent crude fell 1.16 percent to 87.55 dollars a barrel and West Texas Intermediate fell 0.45 percent to 81.99 dollars a barrel as investors weighed talks between Iran and Oman over an agreement covering the Strait of Hormuz.

Precious metals retreat as United States inflation data lifts rate hike bets

The Personal Consumption Expenditures Price Index, the inflation gauge the Federal Reserve uses to set its target, rose to 3.7 percent in the 12 months through July from 3.6 percent in June, above the 3.6 percent forecast from economists polled by Reuters, according to Reuters and the U.S. Bureau of Economic Analysis. The index rose 0.2 percent on the month, against a forecast of 0.1 percent. Core PCE, which excludes food and energy, was 3.3 percent on the year, no better than it had been in June, Reuters reported. Fed funds futures prices reflected about a 44 percent probability of a Federal Reserve interest rate hike next month by 13:31 GMT on Wednesday, up from about 36 percent immediately before the data, according to Reuters. Higher rate odds pressured gold, since non yielding bullion becomes less attractive when interest rates rise. Silver fell 0.86 percent, platinum fell 1.04 percent and palladium fell 0.67 percent, while copper fell 1.65 percent. The dollar index rose 0.24 percent, which also weighed on dollar priced metals.

CNBC, captured at approximately 19:25 GMT, after the settlement window. These are quoted levels, not confirmed exchange settlements.

Energy prices ease as Hormuz talks continue

The 2 crude benchmarks stood 5.56 dollars a barrel apart, on our calculation. Reuters reported that Iran and Oman are still working out the details of an agreement covering the Strait of Hormuz, and that Saudi Aramco has offered more oil for loading outside the strait in September, with some cargoes heading to China. Natural gas rose 3.68 percent, the sharpest move in the energy complex, with no confirmed driver behind the move; the contract expires on 27 August. RBOB gasoline rose 1.23 percent and heating oil rose 0.05 percent.

CNBC, captured at approximately 19:25 GMT, after the settlement window. No exchange settlement notice for 26 August had been published for these contracts at the time of capture.

Wheat surges to a fresh 52 week high while other grains also gain

Wheat rose 6.40 percent to 748.25 cents a bushel, its highest level in 52 weeks, according to CNBC, a level independently cross checked against December 2026 CBOT wheat data. The move takes wheat about 52.0 percent above its own 52 week low of 492.25 cents a bushel, reached on 14 October 2025, on our calculation. Reuters reported that Chicago wheat set a fresh multi year high on Wednesday as a virtual halt to grain loadings at Russian and Ukrainian Black Sea ports, following weeks of attacks on shipping, cast doubt over grain flows, with repair works at 1 of the 3 grain terminals at Russia’s main Black Sea export port of Novorossiysk expected to take up to 4 months. Corn rose 2.34 percent and soybeans rose 1.92 percent, while sugar rose 2.03 percent and cotton rose 0.93 percent. Coffee fell 4.32 percent, the sharpest decline in the group, and cocoa was unchanged.

CNBC, captured at approximately 19:25 GMT. Grain prices were unchanged from the earlier capture, since CBOT’s agricultural session had already gone quiet for the day. Wheat’s level was independently cross checked against December 2026 CBOT wheat data; no exchange settlement notice for 26 August had been published for these contracts at the time of capture.

Treasury yields, the dollar and crypto

The United States Treasury had not yet posted 26 August’s par yield curve at the time of capture; the 2 most recently published sessions, 25 and 24 August, are compared below. The 10 year yield fell 6 basis points to 4.64 percent and the 2 year yield fell 7 basis points to 4.17 percent between the 2 sessions. The dollar index rose 0.24 percent to 99.16, the euro fell 0.19 percent against the dollar and the pound fell 0.42 percent, while the yen weakened 0.12 percent against the dollar. The CBOE Volatility Index fell 1.04 percent to 15.29. Ether rose 0.64 percent while bitcoin fell 0.52 percent.

U.S. Department of the Treasury, daily par yield curve. The 26 August row had not yet posted at the time of capture; the 25 and 24 August rows are shown instead.

CNBC, captured at approximately 19:25 GMT.

Why it matters: The post-PCE rise in the market priced probability of a Federal Reserve rate hike next month, to about 44 percent from about 36 percent immediately before the data, raises the cost of holding non yielding assets like gold and silver, and a firmer dollar makes dollar priced commodities more expensive for buyers using other currencies, a mechanism that touches Gulf economies directly since their currencies are pegged to or managed against the dollar and their energy exporters price oil in it. Wheat’s move to a fresh 52 week high, driven in part by Black Sea export disruption, is a price signal worth watching for food importing economies in the region, since higher wheat costs eventually reach import bills and consumer bread prices. Developments in the Iran and Oman talks over the Strait of Hormuz and the availability of alternative export routes remain the 2 variables most likely to move energy prices from here.

Outlook: The marker to watch is Federal Reserve Chairman Kevin Warsh’s keynote at the Jackson Hole Economic Policy Symposium on Friday 28 August, his first as chairman, since any signal on rate hike odds would extend or ease pressure on gold and silver. On wheat, whether Black Sea export disruption continues or eases in the coming days, together with the daily United States Department of Agriculture export data, will help determine whether Wednesday’s 52 week high holds or fades. The Iran and Oman talks over the Strait of Hormuz remain the main swing factor for Brent and West Texas Intermediate.

Sources: U.S. Bureau of Economic Analysis; CNBC; Reuters; Barchart (CBOT contract data); U.S. Department of the Treasury; Bloomberg.

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