Gold retreats amid inflation concerns linked to oil prices

Gold prices fell slightly on Monday, as rising oil prices exacerbated inflation concerns and bolstered expectations that the US Federal Reserve (the US central bank) may raise interest rates at its monetary policy meeting this week.

By 01:19 GMT, spot gold fell 0.5 percent to $4,327.80 per ounce, after recording a decline for a third consecutive week on Friday. US December gold futures fell about 1 percent to $4,368.60.

According to the CME Group’s FedWatch tool, traders are pricing in an approximately 86 percent probability of a US interest rate hike during the central bank’s monetary policy meeting on September 15-16, up from about 67 percent prior to last week’s inflation data release.