Gold Rebounds as Oil Prices Surge, Fed Rate Hike Bets Rise

Gold prices rebounded on Friday after falling nearly 2% in the previous session. The metal rose 0.8% to $4,351.28 an ounce, while Gold Futures fell 0.4% to $4,391.37.

The U.S. Dollar Index was little changed at 99.04. Investors weighed higher oil prices, Treasury yields and expectations for a Federal Reserve rate hike next week.

Hotter PPI data showed the index rose 0.4% in August, the strongest increase since May. This reinforced concerns that rising energy costs are feeding into broader inflation just days before the Fed’s policy decision.

Oil has become a major part of that inflation story, with Brent crude climbing close to $108 a barrel as the United States and Iran showed little sign of backing away from a prolonged conflict.