Gold Prices Take a Hit as Investors Await Fed Meeting

Gold prices took a hit on Tuesday as investors turned their attention to the upcoming Federal Reserve meeting. The precious metal declined by 0.5% to $4,391.14 per ounce, while US gold futures for December delivery dropped 0.6% to $4,446.70.

The decrease in gold prices came as benchmark 10-year US Treasury yields extended their recent gains. Higher bond yields can be detrimental to gold because the precious metal does not generate interest or regular income, making bonds more attractive to investors as yields rise.

Additionally, oil prices moved higher due to geopolitical tensions, adding further market pressure. The situation remains uncertain, with investors watching for signs that could impact oil supplies and inflation.

The Federal Reserve meeting is now at the forefront of investors' minds. Markets are pricing in a 65% probability that the Fed will leave interest rates unchanged at its September meeting. The minutes from the July meeting are set to be released on Wednesday, which may provide additional clues about policymakers' views on inflation and economic growth.