Gold Surges Above $4,400 as Weakening Bond Yields Boost Prices
Gold prices have continued to rise above $4,400 as investors react to weakening bond yields and a soft US dollar.
The precious metal gained follow-through buyers for the second straight day on Thursday, with its momentum pushing it further beyond the $4,400 mark during the Asian session.
The recent surge in gold prices comes despite firming expectations of a Federal Reserve rate hike and inflation risks stemming from higher energy prices. According to CME Group's FedWatch Tool, traders are pricing in around a 62% chance that the US central bank will hike rates at its upcoming September 15-16 policy meeting.
Fed Chair Kevin Warsh's hawkish remarks last Friday lifted expectations of a rate hike, while worries about rekindled inflationary pressures also support the case for Fed tightening. However, geopolitical uncertainties continue to support the safe-haven US dollar and cap the non-yielding bullion.