Gold Prices Fall as Dollar Rises Amid Anticipation of US Central Bank Decision
Gold prices dropped due to the strength of the dollar, while investors await the Federal Reserve's upcoming interest rate decision amid inflation concerns.
Translated by Qiyas from الراي — Original source
Gold prices fell on Tuesday as the US dollar rose, with investors awaiting the Federal Reserve’s monetary policy meeting this week for clues on the interest rate trajectory.
Spot gold fell 0.3 percent to $4,003.59 per ounce by 05:30 GMT, while US December gold futures dropped 0.5 percent to $4,016.10.
Ilya Spivak, head of global macroeconomics at Testi Life, said, “We see gold consolidating within the range it recorded on Friday, following the sharp decline last week.”
Gold fell below the $4,000 mark for the first time since mid-July last week, recording a weekly drop of 4 percent—the worst weekly performance in about four months. Rising energy prices fueled inflation concerns and bolstered expectations that the Federal Reserve would raise interest rates.
Federal Reserve policymakers indicated they would not raise short-term borrowing costs in the US again this week, but persistent inflation worries are leading investors to believe that the pause in rate hikes will not last long.
Markets are awaiting the Fed’s monetary policy decision on Wednesday, along with personal consumption expenditures data on Thursday, a key indicator closely monitored by the central bank as it targets a 2 percent inflation rate.
CME Group’s FedWatch tool shows traders are pricing in an 11 percent probability of a rate hike this week, compared to an 82 percent chance of a hike in December.
In other precious metals, spot silver fell 1.6 percent to $53.06 per ounce, platinum declined 1.3 percent to $1,506.94, and palladium dropped 1.8 percent to $1,030.75.
