Gold Trades Near $4,400 Amid Rising Fed Rate Hike Expectations
Gold prices continue to trade near $4,400 per ounce as markets price in a 60% chance of a Federal Reserve rate hike in September. The stronger-than-expected US jobs report for August showed 162K payroll additions, far exceeding consensus estimates of 56K. This has pushed Fed rate-hike expectations to ~60%, lifting the dollar and capping gold's near-term upside.
Despite this pressure, heightened geopolitical risks in the Middle East and structural central bank reserve diversification provide a firm price floor for gold. Central banks remain major buyers of gold, with estimated net purchases reaching 345 tonnes in the first half of 2026. This demand helps mitigate deeper corrections despite rising yields.
The ongoing tensions between the US and Iran have driven defensive flows into safe-haven assets like gold. Market-implied Fed rate-hike expectations for September rose to approximately 60% following the jobs report, making it a tight tug-of-war for the non-yielding asset.