Gold Stuck Below $4,200 as Oil Prices and Rate Hike Expectations Weigh

Gold struggled to gain momentum above $4,200 on Wednesday and is currently trading near $4,150 in Thursday's Asian session. The precious metal has been influenced by a mix of factors, including elevated oil prices and interest rate hike expectations.

The US economic data releases and speeches from Federal Reserve policymakers are set to provide fresh cues on the Fed's policy outlook, driving the USD, yields, and bullion. Recent inflation data showed core Personal Consumption Expenditures (PCE) Price Index rose 3% year-over-year in August, which weighed on October Fed rate hike bets.

The US economy grew by 2.2% in Q2, beating market forecasts of 1.5%, while ADP private sector payrolls increased by 90,000 jobs last month. The benchmark 10-year US Treasury bond yields hit 5.31%, the highest level since mid-June 2007.

Federal Reserve's Kashkari expressed a hawkish stance, highlighting strong consumer spending and job availability as reasons for sustained restrictive policy. This reinforced expectations of one more hike this year and another in 2027.