Gold Hit, Dollar and Fed Oppose
Gold prices fell below US$4,100 per troy ounce in trading on Thursday (July 23rd), after previously touching a two-week high. This decline occurred as the market refocused on surging oil prices and rising inflation risks.
Middle East tensions were the main driver of market pressure. The Iran-backed Houthi group claimed to have targeted two Saudi Arabian oil tankers as part of a naval blockade, raising concerns about global energy supply lines.
Simultaneously, the United States launched its 12th nighttime attack on Iran. This further attack prompted a retaliatory response from Tehran and increased the risk of disruption to energy exports from the Gulf region.
Rising oil prices have raised investor concerns about the potential for further decline in US inflation. This situation has fueled expectations that the Fed will maintain its tight policy for longer, potentially even raising interest rates by the end of the year.
Consequently, gold is potentially volatile and likely to remain subdued as long as expectations of a Fed rate hike remain strong. The market now estimates a 78% chance of a September rate hike. If XAU/USD fails to return above US$4,100, pressure could continue, although geopolitical risks could still maintain safe-haven interest. (arl)
Source: Newsmaker.id
