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Gold falls below $4,100 as Fed hike bets strengthen and USD firms

Gold slid below $4,100 as escalating US-Iran tensions pushed oil higher and helped drive over a 90% chance of a Fed hike this year, according to CME FedWatch.

Reported · Written up by our desk · Major Pairs

Gold (XAU/USD) weakened during the first half of the European session, sliding below $4,100 and retreating further from an over two-week high reached the prior day, FXStreet reported.

The move was linked to rising Fed hike expectations as US-Iran tensions escalated and supported crude prices, which in turn revived inflation concerns. FXStreet noted that US Treasury yields stayed supported near a multi-month high, a headwind for non-yielding bullion.

FXStreet also pointed to market pricing, citing CME Group’s FedWatch Tool that showed traders assigning over a 90% chance of a Fed rate hike by the end of the year. The article said the firmer yields helped the US dollar attract dip-buyers, adding pressure to gold.

Looking ahead, FXStreet said investors were watching US Weekly Initial Jobless Claims for potential momentum and flagged the ECB meeting as a potential source of added volatility, while monitoring further developments in the Middle East crisis.

Latest closeGold $4,430.80 ▲1.6%|WTI crude $83.42 ▲1.6%

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