Dollar Weakness Boosts Gold, Crude Oil Prices May Slide Towards $80 Barrel
Gold prices remain on track for further gains due to a weaker US dollar and fading expectations of a near-term interest rate hike, while crude oil prices may dip towards $80 per barrel as Gulf exports and weak demand offset potential supply disruptions.
A report from Kotak noted that the softer US retail sales and consumer sentiment have pressured the dollar, reducing expectations of a September Fed hike. As a result, gold prices edged higher in early Asian trade on Wednesday, supported by softer US Treasury yields.
The yellow metal was trading at around $4,355.76 at the time of reporting, while silver outperformed with a 1.6% gain to $65.73 an ounce. Geopolitical tensions, including renewed Strait of Hormuz attacks and possible US measures against Iran, continued to support bullion.
However, benchmark crude oil prices remain cautiously bullish as the market balances escalating geopolitical risks against continued physical supply flows and concerns over demand. Gulf producers are reportedly maintaining crude flows above 4 million barrels a day, limiting the immediate impact of disruptions.