Gold Prices Slip on Fed Rate Hike Expectations and Oil Surge
· Business · LiveMint, Wall Street Journal
Gold prices dropped on Monday as rising oil costs intensified inflation concerns and strengthened expectations of further US Federal Reserve interest rate hikes. Spot gold fell 0.7% to $4,254.77 per ounce, while US gold futures declined 0.7% to $4,289.70. The Fed raised its benchmark interest rate by a quarter percentage point to between 3.75% and 4% earlier in the month, and CME's FedWatch Tool indicates traders are pricing in a 66% chance of another hike in October. Meanwhile, US consumer sentiment fell to a four-month low in September amid growing anxieties over purchasing power. Cleveland Fed President Beth Hammack stated on Friday that persistent inflation risks conditioning the public to accept elevated prices as the norm.
Why it matters
Higher gold prices and elevated US interest rates impact global commodity markets, currency valuations, and investor sentiment across emerging markets like India.
Read the original report — LiveMint
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