Gold Tumbles Below $4,400 Amid Shift in Rate Expectations

Gold prices edged below $4,400 an ounce on Tuesday as traders weighed the outlook for US inflation and interest rates. The spot price of gold lost up to 0.7% in a single day, with the dollar steady after hitting a three-month low on Monday.

The decline comes despite softer US economic data, which has reduced expectations of another Federal Reserve rate hike before the end of the year. According to Ole Hansen, head of commodity strategy at Saxo Bank AS, this could be removing two of the headwinds that contributed to gold's earlier correction.

However, the risk of further Fed rate hikes remains, particularly with investors awaiting clues on the prospects for peace in the Middle East. Tensions remain around the Strait of Hormuz, a key shipping route still disrupted due to attacks on vessels.