Gold Soars Towards $4,400 on Collapsing Fed Hike Bets
Gold prices have surged towards $4,400 as Federal Reserve hike bets collapse. The metal has gained roughly 0.4% on Monday to trade near $4,391 an ounce.
The Fed minutes could direct next steps, but weak US spending and cooling inflation have revived bullion's rally. A softer dollar and weaker US economic data improved demand for gold, which prefers low-interest environments.
Traders now assign only around a 30% probability to a September Federal Reserve rate increase, down from 47% recently. Lower interest-rate expectations generally support gold by reducing the opportunity cost of holding non-interest-bearing assets.
The bull case requires oil anxiety without a full inflationary relapse. Escalating attacks or infrastructure damage could initially drive haven demand, but sustained crude above $90 may lift bond yields and challenge bullion.