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Frank Walbaum Market Analyst at Naga
(MENAFN- Your Mind Media ) Gold was relatively steady early on Tuesday after ’onday’s slide toward a multi-week low. A firmer dollar and higher U.S. yields kept pressure on non-yielding bullion. Elevated oil prices amid Middle East tensions and supply disruptions continued to fuel inflation fears and bolster bets on a Federal Reserve interest rate hike this week, keeping the yellow metal exposed to downsi e risk.
Markets are now pricing in more than a 90% chance of a 25-basis-point rate hike on Wednesday. Overnight, 10-year U.S. Treasury yields touched 5% for the first time since 2023, while European yields also rose and Japanese yields remained elevated, further raising the opportunity cost for gold. Possible additional interest rate hikes from major central banks in the coming months would likely push yields higher and e’tend gold…nbsp;s weakness.
Looking ahead, the Fed decision and press conference are the main catalysts this week. A hawkish Fed could further pull gold down, while any soft messaging may ease bets on hikes and help the metal recover. Traders are also monitoring oil prices and developments in the Middle East.
Markets are now pricing in more than a 90% chance of a 25-basis-point rate hike on Wednesday. Overnight, 10-year U.S. Treasury yields touched 5% for the first time since 2023, while European yields also rose and Japanese yields remained elevated, further raising the opportunity cost for gold. Possible additional interest rate hikes from major central banks in the coming months would likely push yields higher and e’tend gold…nbsp;s weakness.
Looking ahead, the Fed decision and press conference are the main catalysts this week. A hawkish Fed could further pull gold down, while any soft messaging may ease bets on hikes and help the metal recover. Traders are also monitoring oil prices and developments in the Middle East.
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