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Gold slips near $4,350 as oil-driven inflation fears lift rate expectations

Gold’s move comes with traders turning to upcoming US PPI and CPI data that could shift Federal Reserve rate expectations for September.

Reported · Written up by our desk · Precious Metals

Gold prices (XAU/USD) fell to around $4,350 in early Asian trading on Wednesday, as higher oil prices stoked fresh inflation concerns and increased expectations for a Federal Reserve rate hike in September, FXStreet reported. FXStreet said the latest selling pressure is tied to Middle East-related supply and escalation fears that pushed oil higher, a dynamic that traders often associate with tighter monetary policy expectations. With investors focused on US inflation releases later in the day, the timing of the data could influence whether rates expectations extend higher or pull back. According to FXStreet, traders are watching US Producer Price Index and Consumer Price Index inflation data closely because they can affect Treasury yields and the broader outlook for Fed policy. FXStreet also cited CME FedWatch pricing, which showed an over 59.4% chance of a rate increase this month. FXStreet added that technical indicators point to a range-like setup, with gold sitting just above the 100-day simple moving average while still below the 20-day Bollinger midline near $4,466 and with the relative strength index around 47, suggesting limited near-term directional conviction.

Latest closeGold $4,395.60 ▼0.8%

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