Gold Prices | Gold rates fell further in Asian trading on Friday, hitting a three month low as surging crude oil prices heightened inflation concerns. Investors are increasingly expecting interest rates to remain elevated for longer.
Spot gold declined 0.3% to $4,013.91 per ounce by 1:26 GMT. The metal touched its lowest level since July 20. US gold futures fell 0.7% to $4,031.50 per ounce.
ALSO READ: Women’s U19 T20 World Cup 2027 Schedule Released
Gold prices plunged 2.8% on Thursday and were heading towards a weekly loss exceeding 3.5%. Rising energy prices and expectations of tighter monetary policy weighed on investor sentiment.
Brent crude futures climbed to $114 per barrel, marking a five month high. The rally followed attacks by Yemen’s Houthi group in Saudi Arabia, raising concerns about potential disruptions to energy supplies.
Higher oil prices could push inflation higher and encourage central banks to maintain restrictive monetary policies. This environment typically puts pressure on gold because the precious metal does not offer interest income.
Gold Prices | Gold Faces Pressure From Oil Prices and Fed Outlook
Recent US consumer and producer inflation data came in above expectations. The figures strengthened concerns that inflation could remain persistent.
The US Federal Reserve is widely expected to leave interest rates unchanged at its October 27 and 28 meeting. However, traders are pricing in a 78% probability of a rate hike in December, according to the CME FedWatch Tool.
ALSO READ: Kukatpally Fire Accident: Huts Gutted, Two Injured
Although gold is traditionally considered a hedge against inflation, higher interest rates increase the opportunity cost of holding the metal. Consequently, investors may favour interest bearing assets when borrowing costs remain high.
Other precious metals also recorded significant losses. Spot silver fell nearly 6% on Thursday, while platinum declined 3.6%.
Silver was quoted at $54.038 per ounce, down 1% in the reported trading session. Platinum traded almost unchanged at $1,567.10 per ounce.
Market participants are now watching crude oil movements, inflation indicators and Federal Reserve policy signals. These factors could determine whether gold extends its losses or finds support near current levels.
Now you can get the latest stories from Indtoday on Telegram every day. Click the link to subscribe. Click to follow Indtoday’s Facebook page, Twitter, and Instagram. For all the latest Hyderabad News updates and Follow us on GoogleNews
