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Gold hits fresh June high as USD slides and Fed hike bets ease
Bullion is supported by a pullback in expectations for an immediate Fed hike after cooling US inflation data, while Middle East oil risks keep inflation concerns elevated.
Gold prices pushed to a fresh high since early June, trading around the $4,544 area and extending gains during Friday’s Asian session, FXStreet reported. The move comes as gold holds momentum above a technically important 200-day simple moving average.
FXStreet said traders have scaled back near-term bets on an immediate Federal Reserve rate hike after recent US inflation data suggested cooling price pressures. That has kept the US dollar weaker near multi month lows, which tends to support non-yielding bullion.
The outlook for gold also reflects ongoing inflation risk tied to higher oil prices amid escalating Middle East tensions, including the US-Iran standoff over the Strait of Hormuz. FXStreet noted reports that Iran backed Houthi militants claimed targeting eight oil tankers after declaring a maritime blockade on Saudi shipping, lifting oil to a three-week high.
Still, investors remain cautious, as Fed guidance continues to point to possible further tightening. FXStreet cited FOMC minutes showing officials viewed a need to raise interest rates soon unless inflation progress continues, and CME’s FedWatch tool indicates investors are pricing roughly a 68.0% chance of at least one more rate increase by year end.
Latest closeGold $4,432.00 ▲1.6%