Gold Surges on Oil Price Drop Ahead of Fed Interest Rate Decision
The price of gold and silver rose in the latest trading session, reaching $4,073.5 per ounce for gold, up $21.8 from the previous day.
The increase was driven by a sharp drop in oil prices following a temporary halt in US-Iran attacks. Brent oil closed at $85.87 per barrel, down 6.3%, while US WTI crude oil fell to $82.61 per barrel, down 7.5%.
This cooling of energy prices helped reduce inflationary pressure and lower US government bond yields, which fluctuated around 4.6%. The USD index weakened or remained steady, providing more support for gold.
The market remains cautious ahead of the US Federal Open Market Committee's interest rate decision this week. Some forecasts suggest a 33% probability of raising interest rates by another 25 basis points in the upcoming meeting and an 80% chance of higher rates in September.