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Gold slips back below $4,400 as Fed hike bets firm
Gold fell from a June 5 high near $4,450 to below $4,400 after easing July CPI signs were outweighed by inflation concerns tied to oil and war-risk premiums.
Gold (XAU/USD) extended an intraday pullback from its highest level since June 5, hovering near the $4,450 area before sliding back below $4,400 in the latest move, FXStreet reported.
The decline reflected fading optimism around moderating US inflation, as traders weighed expectations that higher energy prices could revive inflationary pressure and reinforce Federal Reserve hike bets. That backdrop came after the US Bureau of Labor Statistics reported on Wednesday that headline CPI cooled to 3.4% year over year in July from 3.5%, while core CPI rose 0.2% month over month and 2.5% year over year, matching consensus.
FXStreet also pointed to other recent data that shapes the Fed outlook, including a weak US nonfarm payrolls report, which was seen as giving the Fed more room to keep rates steady in September. Even so, investors remain focused on inflation risks from volatile oil amid the US-Iran standoff, with Trump reiterating that the US has control over the Strait of Hormuz, Iran pledging to keep the waterway closed until demands are met, and escalated attacks by Iran-backed Houthis affecting shipping in the Red Sea and Bab el-Mandeb strait.
The article added that war-risk premiums have supported crude oil prices, and CME Group’s FedWatch Tool showed traders still pricing in nearly an 80% chance of a US rate increase in 2026. It noted that follow-through below $4,400 is needed for a deeper corrective decline, with traders watching Thursday’s US producer price index, weekly initial jobless claims, and FOMC speeches for fresh signals on USD demand.
Latest closeGold $4,467.10 ▲1.9%|WTI crude $82.68 ▼0.6%