Gold hits near two-week low on Fed chief’s hawkish stance
This follows the US central bank’s signal that rate hikes may be needed to ease price pressures
Gold reached a near two-week low on Monday due to the Federal Reserve chair Kevin Warsh's hawkish stance on interest rate hikes, amid escalating Middle East tensions. Spot gold fell 0.8% to $4,417.04 per ounce, its weakest level since August 19. US gold futures declined 1.4% to $4,466.80. Analysts cited Warsh's comments at the Jackson Hole economic symposium, stating that the Fed would need to work towards confirming inflation heading down to 2%, potentially prompting rate hikes.
The possibility of a Fed rate hike in September stood at 60% according to the CME FedWatch tool. Inflation concerns were exacerbated by rising oil prices due to US military action in Iran. Other precious metals like silver, platinum, and palladium also experienced declines.
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