Gold's Shine Fades for Second Week Amid Oil Price Rise

Gold recovered on Friday after hitting its lowest level in more than three months, but it is on track for a second consecutive weekly decline. Rising energy prices have stoked inflation concerns and bolstered expectations that interest rates will remain higher for longer, ahead of the Federal Reserve’s meeting next week.

Spot gold rose 0.2 percent to $4,030.67 per ounce, after earlier falling below $4,000 for the first time since mid-July, touching an intraday low of $3,986.50. As a result, the precious metal has lost 3.2 percent of its value so far this week.

Brent crude touched its highest level in more than five months following Houthi attacks on Saudi Arabia, raising fears of further disruptions in energy supplies.

Jim Wyckoff, market analyst at American Gold Exchange, said, “Growing inflation concerns indicate that major central banks around the world will not be able to ease monetary policy as quickly as they would like. All of this is currently weighing on gold and silver.”

Major Wall Street indices opened lower amid caution following a sharp sell-off in artificial intelligence-related stocks.

Traders widely expect the Federal Reserve (the U.S. central bank) to keep interest rates unchanged at its meeting scheduled for the 27th and 28th of this month, despite U.S. consumer and producer inflation data released last week coming in stronger than expected, which has increased the likelihood of a tighter monetary policy later this year.