Gold Prices Soar as Oil Decline Eases Inflation Concerns

The price of gold rose sharply on September 18, surging by as much as 2.8% to $4,380 an ounce, after a decline in oil prices eased concerns about inflation.

This uptick comes despite the US Federal Reserve's first interest rate hike since 2023, which initially weighed on gold prices due to higher bond yields.

Treasury yields cooled following the Fed's decision, helping to lift pressure off gold as it typically performs poorly when bond yields are high.

According to Christopher Wong, a strategist at OCBC, Treasury yields were correcting from their previous overreaction, which in turn has helped support gold prices.