Gold Heads for Third Straight Weekly Decline Amid US Rate Hike Expectations
Gold prices are on track for their third consecutive weekly loss as expectations of a US rate hike strengthen ahead of key inflation data. The metal is up 0.2% at $4,324.79 per ounce but down more than 2% for the week so far.
The upcoming US consumer price index data is expected to provide further clues on the Federal Reserve's policy path. A stronger-than-expected reading would reinforce the case for several interest rate increases, potentially pushing Treasury yields and the dollar higher and placing additional pressure on gold, according to Wael Makarem, financial markets strategists lead at Exness.
Despite gold being known as an inflation hedge, rising interest rates often pressure the metal, which offers no yield. Ongoing Middle East tensions could also continue to weigh on gold through higher inflation expectations.