Gold Sinks to Near Two-Week Low on Inflation Concerns and Rate Hike Fears
The price of gold has been under pressure this week, hovering near its lowest level in almost two weeks. Spot gold traded around $4,450 an ounce on Tuesday after touching a low since August 19 on Monday.
This decline follows a warning from Fed Chair Kevin Warsh at the Jackson Hole conference that policymakers may need to tighten again if inflation fails to move convincingly towards 2%. Markets now put the probability of a September increase at about 66%.
The US labour-market calendar is set to decide whether the Federal Reserve raises interest rates in September. The first test comes later Tuesday with July's JOLTS job-openings report, due at 10 am ET. Openings stood at 7.4 million in June, while the market expects July to show only a modest decline towards 7.3 million.
FXStreet analyst Dhwani Mehta sees $4,400 as an increasingly important near-term battleground. Her technical assessment puts the 21-day moving average near $4,430, followed by the 100-day average around $4,366. A recovery through the 200-day average near $4,531 would strengthen the bullish setup again.