Gold slips to near two-week low on Fed rate hike bets
Gold | 2026-09-01 00:13:08
Gold fell on Monday, hovering near a two-week low, as investors assessed growing expectations of a Federal Reserve rate hike following hawkish comments from Chair Kevin Warsh as a surge in oil prices further added to inflation concerns.
By Paul Ploumis
SEATTLE (Scrap Monster): Gold fell on Monday, hovering near a two-week low, as investors assessed growing expectations of a Federal Reserve rate hike following hawkish comments from Chair Kevin Warsh as a surge in oil prices further added to inflation concerns.
Spot gold fell 0.4% to $4,433.19 per ounce by 01:39 p.m. EDT (1739 GMT), having touched its lowest level since August 19 earlier.
Still, the metal remained set for its strongest monthly performance since January, with prices up 9.7% so far.
U.S. gold futures for December delivery dropped 1.1% to settle at $4,481.50.
"The biggest reason right now is higher interest rates, higher inflation expectations, driven by energies and drawdown of oil inventories," said Daniel Pavilonis, senior market strategist at Stone X.
"And then the U.S. yields are continuing to strengthen, the dollar is continuing to strengthen. I think that puts gold in a precarious position," he added.
Crude prices rose more than 2% on Monday after the United States struck an Iranian island in the Strait of Hormuz and Tehran said it had responded, escalating a conflict that has now entered its sixth month.
While the U.S. dollar remained near a roughly two-week high, a slight pullback in the currency helped limit further decline.
Gold tumbled more than 3% on Friday, marking its sharpest daily decline since June 10, after Fed chief Warsh signaled at the Jackson Hole symposium that policymakers may need to do more if inflation does not move back toward the central bank's 2% target.
Traders have raised bets on a September rate hike to about 64%, from about 36% before Warsh's comments, according to the CME FedWatch Tool. FEDWATCH/
Markets now await the U.S. ADP employment report and the nonfarm payrolls data due later this week for more cues on the economy and interest rates.
Elsewhere, spot silver fell 0.2% to $66.24 per ounce, and is up about 15% this month after hitting its highest since mid-June on Friday.
Platinum slipped 2% to $1,783.55, but was on track for its biggest monthly gain since February. Meanwhile, palladium slid over 4.3% to $1,360.83, though it remained headed for its strongest monthly rise since December.
Courtesy: www.reuters.com
