Gold Prices Plummet Amid US Rate Hike Fears and Rising Oil
Gold prices plummeted to their lowest level in nearly two weeks after US Federal Reserve Chair Kevin Warsh hinted at potential interest rate hikes. The Fed's hawkish stance, combined with escalating Middle East tensions and rising oil prices, weighed on gold.
Spot gold fell 0.8 per cent to $4,417.04 per ounce by 0406 GMT, its weakest level since August 19. US gold futures declined 1.4 per cent to $4,466.80.
'Gold is still licking its wounds after the hawkish tone struck by Warsh at Jackson Hole,' said Tim Waterer, chief market analyst at KCM Trade. 'US military action in Iran has put upward pressure on oil prices, and this has added to gold's woes from an inflation standpoint.'
Markets currently see a 60 per cent chance of a Fed rate hike in September, according to the CME FedWatch tool.