Gold Treads Water Above $4,400 as Fed Expectations Weigh on Dollar
Gold prices held above $4,400 as the US dollar weakened due to expectations of further policy tightening by the Federal Reserve and lingering geopolitical risks. The safe-haven currency's resilience was also supported by a widening standoff between the US and Iran.
A stronger-than-expected US Nonfarm Payrolls report accelerated job creation in August, prompting markets to ramp up expectations for a rate increase later this month. This shift towards hawkish sentiment reinforced the USD on dips and presented a challenging backdrop for gold bulls.
Market participants remain cautious ahead of key US inflation readings due later in the week, particularly the Consumer Price Index (CPI) on Friday. The data is expected to offer clarity on the Fed's policy outlook, which could be pivotal for near-term USD performance and provide a catalyst for the next significant move in gold.