Gold Holds Decline as Traders Weigh Prospects for Fed Rate Hike
Gold held a decline, after stronger-than-expected US payrolls data raised the prospects for an interest-rate hike as early as next week.
Gold prices slipped on Friday as investors considered the likelihood of an early interest rate increase by the US Federal Reserve. The precious metal slipped 1% to around US$4,430 per ounce, after gaining 1% the previous day. August's robust job growth and unchanged US unemployment rate have strengthened arguments for a rate hike at the Fed's upcoming September meeting.
A stronger US dollar, priced in gold, also contributed to the decline. Traders increased their bets on a September rate hike, with a 60% chance of a hike, compared to an even chance earlier in the day. Gold prices have been trading within a narrow band since bouncing back from a low near US$4,000 in July. The metal fluctuated between US$4,400 and US$4,450 over the week ending September 6 as traders evaluated the potential Fed policy shift.
The upcoming release of US consumer price data on Friday will offer insights into the central bank's decision on rates. Heightened Middle East tensions have raised fresh concerns about potential energy disruptions, adding to inflationary worries. Meanwhile, oil prices fluctuated amid escalating Middle East tensions.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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