Investing.com — Gold prices remained below $4,000 an ounce on Thursday as persistent inflation pressures and increasingly hawkish Federal Reserve commentary strengthened expectations for another interest-rate increase in December.
At 19:55 ET (00:55 GMT), spot gold edged 0.01% higher to $3,988.35 an ounce, after losing more than 1% in the previous session. U.S. gold futures fell 0.17% to $3,993.55.
Silver declined 0.14% to $51.6050 an ounce, while platinum lost 0.20% to $1,535.15. Spot palladium slipped 0.04% to $1,032.18, while palladium futures fell 0.07% to $1,029.50. The U.S. dollar Index eased 0.05% to 102.87.
Bullion had traded near $3,970 after its previous-session decline. Markets are now fully pricing in a 25-basis-point Fed rate increase in December, while some investors are also considering the possibility of a larger, 50-basis-point move.
Chicago Fed President Austan Goolsbee described October’s inflation report as “borderline disturbing,” while fellow policymaker Anna Paulson warned that elevated price pressures were not being driven by temporary factors.
Bond and currency markets have also reflected the shift in rate expectations. Two-year U.S. Treasury yields, which are particularly sensitive to changes in near-term monetary policy, jumped 18 basis points on Tuesday.
Higher borrowing costs typically undermine gold’s appeal because bullion generates no interest income, while a stronger dollar makes the metal more expensive for buyers using other currencies.
ANZ analysts said the stronger-than-expected inflation reading and resilient economic data had increased expectations of a more aggressive Fed stance, potentially including a 50-basis-point increase in December. They added that rising Treasury yields and further dollar strength had weighed on investor demand for gold.
Original Article
Gold clings below $4,000 as inflation fears fuel bets on bigger Fed hikes
Oil prices dip 1% on report of more U.S.-Iran diplomacy plans
Oil prices rise amid mixed messaging on Iran peace efforts, Hormuz ship attacks