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Gold eases below $4,100 as dollar firms ahead of Fed decision
Gold trades near $4,073 after a brief move above $4,100, while WTI rebounds from intraday lows and traders continue to price in Fed tightening risk.
Gold (XAU/USD) opened the week with a bullish gap but struggled to hold above $4,100 as optimism around a temporary pause in US and Iran attacks faded, according to FXStreet. At the time of writing, the metal traded around $4,073, up 0.5% on the day after briefly climbing above $4,100.
FXStreet said the US Ambassador to the United Nations, Mike Waltz, indicated negotiations have room to proceed while military options remain on the table, and Tehran said it would refrain from fresh attacks if Washington did the same. Still, an Iranian Foreign Ministry spokesperson said the Strait of Hormuz has not changed and remains closed, keeping geopolitical risk in focus.
The move in oil also fed into gold's outlook, with WTI near $82.70 per barrel after rebounding from an intraday low of $81.28, while still down more than 7% on the day. FXStreet linked gold’s reaction to its apparent decoupling from traditional safe haven behavior since the US-Iran war began, with price action driven largely by oil’s inflation impact and implications for Federal Reserve policy.
FXStreet flagged the Fed’s interest rate decision on Wednesday and US Personal Consumption Expenditures inflation data on Thursday as key events, noting expectations for unchanged rates but market pricing for a hike. The report cited CME FedWatch Tool pricing for a 33% chance of a hike, with the probability of a September increase near 79%, alongside a firmer US dollar, with the US Dollar Index around 101.50 after recovering from an intraday low of 101.12.
Latest closeGold $4,055.70 ▲0.2%|WTI crude $90.47 ▼1.9%|Dollar index 101.47 ▲0.0%