Gold Prices Soften Amid Oil Surge, Inflation Fears
Gold prices softened on Tuesday as oil prices surged to multi-week highs, reigniting inflation fears and expectations for interest-rate hikes. Spot gold fell 0.1% to $4,400.66 per ounce by 11:48 GMT, while US gold futures for December delivery dropped 0.7% to $4,445.20.
Nikos Tzabouras, a senior market analyst at Tradu.com, said that gold is 'caught between Fed rate hike bets and dollar softness.' Higher oil prices stoke inflation risks and expectations for Fed rate hikes, putting the precious metal under pressure.
The US job growth accelerated sharply in August, with the unemployment rate holding steady at 4.1%. This has led traders to price in a 61% chance of an interest-rate hike at the central bank's policy meeting, up from about 50% before the data.