Gold gains amid lower US rate hike fears
Gold prices rose on Wednesday, supported by a decline in investors’ expectations of an interest rate hike by the U.S. Federal Reserve, amid anticipation of U.S. inflation data that will shape the monetary policy outlook. December futures contracts for gold increased by 0.17%, reaching approximately $4,448.70 per ounce, while spot prices rose by 0.45% to $4,389.81 per ounce. Inflation data is expected to play a key role in determining the tightening of monetary policy; weaker inflation figures could boost gold’s appeal, whereas rising inflation might lead to higher interest rates and put pressure on the metal. Additionally, gold benefits from current geopolitical tensions, as uncertainty has driven up demand for safe-haven assets, with prices climbing more than 8% since early August. Gold remains highly sensitive to movements in interest rates and the dollar, since rate hikes increase the cost of holding non-yielding assets like gold. Expectations of easing monetary policy also enhance its attractiveness for investors.
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