Gold Slumps as Strong Dollar, Yields Offset War-Risk Premium
Gold slumped more than 5% after a four-day rally as traders weighed the escalating war in the Middle East against the prospect of a stronger dollar and elevated inflation.
Spot gold fell 5.3%, to $5,034.22, an ounce at 9:50 a.m. in New York.
The conflict in the Middle East has already resulted in a spike in energy prices that could trickle into inflation data, raising the likelihood that the Federal Reserve will leave rates unchanged for longer. Higher interest rates typically weigh on non-yielding bullion, as does a stronger US dollar.
Source : Bloomberg.com