Fed's Neutral Rate Debate Clouds Policy Path, Pressures Gold

Federal Reserve officials are divided over whether the 3.75–4.00% policy rate is neutral or still accommodative, with St. Louis Fed President Alberto Musalem shifting his view between January and August. September FOMC projections raised the median longer-run rate to 3.2%. The debate matters for gold, as a higher neutral estimate could keep Treasury yields and the dollar elevated.