Gold Price Falls Amid Rising Fed Hike Expectations
The price of gold has retreated after briefly rising above $4,600 an ounce due to increasing expectations of a Federal Reserve rate hike. The upcoming Fed meeting on September 15-16 is putting pressure on gold even as geopolitical tensions continue to support demand for the metal.
Recent jobs data from the U.S. Bureau of Labor Statistics (BLS) has become a key factor in rate expectations, with July nonfarm payroll employment falling by 23,000 and the unemployment rate remaining at 4.1%. The BLS also reported a preliminary benchmark revision that cut March employment by 79,000.
The CME Group's FedWatch tool is now pricing one Federal Reserve rate hike for the remainder of 2026, compared to two previously. This change in expectations has reduced the relative appeal of gold as a non-yielding asset.