Gold prices continued to decline amid high energy prices and expectations that the U.S. Federal Reserve may raise interest rates again. The spot price of gold fell 0.5% to $4,261.59 per ounce, Bloomberg reports, writes UNN.
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Over the past week, the precious metal lost more than 2%. In September, gold mostly traded in the range of $4,230 to $4,510 per ounce, while in January its price reached a record high of nearly $5,600.
High oil prices are adding to pressure on gold. Due to the deadlock surrounding the Strait of Hormuz, Brent has risen by approximately 70% since the beginning of the year, supporting inflation risks.
Markets expect another Fed rate hike
In mid-September, the Federal Reserve unanimously raised its benchmark rate by 0.25 percentage points. Investors are now assessing the probability of another hike in October at approximately 65%
An additional signal for the markets was the narrowing of the yield spread between 10-year and two-year U.S. Treasury bonds to 17 basis points—the lowest level since the beginning of 2025.
Other precious metals are also becoming cheaper, following gold. Silver lost 0.8% and traded at $63.77 per ounce, while platinum and palladium prices also declined.
Gold holds near $4,375 per ounce after the Fed’s first rate hike since 202321.09.26, 06:15