Gold Prices Retreat as Investors Lock in Profits Amid Reduced Rate-Hike Expectations
Gold prices declined on Friday as investors rushed to lock in profits after the precious metal touched its highest level in over two months. Spot gold fell by 0.1% to $4,344.24 per ounce, extending losses from a 1.3% drop in the previous session that wiped out most of the week's gains.
The pullback comes as traders now price in just a 33% probability of a September rate hike, down from 44% last week. This reduced rate-hike expectation makes gold more attractive to investors compared to yield-bearing assets.
Ole Hansen, an analyst at Saxo Bank, said that gold is trading within a range of $4,200 to $4,500 following last week's breakout. If the metal can break above $4,400, Ilya Spivak, head of global macro at Tastylive, believes reaching $5,000 by year-end is not out of the question.