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Gold holds modest gains as Fed hike bets and a firm dollar weigh

Gold was quoted just below $4,150 Tuesday, after slipping to near $4,100 earlier in the week, while traders price a 70% chance of another Fed rate increase in October.

Reported · Written up by our desk · Precious Metals

Gold held a modest recovery into the European session on Tuesday, trading just below $4,150, but remained near the lowest levels seen since Aug. 4 around the $4,100 area, according to FXStreet.

FXStreet attributed the cautious tone for bullion to a bearish backdrop including hawkish expectations for the US Federal Reserve, elevated US bond yields, and geopolitical risks that have kept the US dollar near a two-month high.

FXStreet noted the Fed delivered a widely expected 25 basis point rate hike earlier this month, its first in more than three years, and signaled it wants to keep suppressing sticky inflation.

Traders are also pricing in a 70% chance of another borrowing cost increase in October, with the view tied to inflation risks linked to higher energy prices related to the Middle East conflict, FXStreet reported.

Latest closeGold $4,147.50 ▼4.0%

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