Gold Tumbles On Rate Hike Expectations
(RTTNews) - Gold prices were sharply lower on Thursday as the U.S. dollar index climbed to a 19-month high on expectations of further tightening by the Federal Reserve.
Hawkish comments from several Federal Reserve officials fueled expectations for a 50-bps rate hike next month.
According to the CME FedWatch Tool, markets are fully pricing in a 25-bps rate hike next month, with the probability of a larger 50-basis-point move currently standing at 11 percent.
Spot gold fell 1.1 percent to $3,943.69 an ounce, hitting a more than one-week low as rate hike expectations boosted the U.S. dollar. U.S. gold futures were down 1.3 percent at $3,948.47 an ounce.
On the economic front, U.S. jobless claims and existing home sales data will be in the spotlight today ahead of Friday's report on producer prices.
New York Fed President John Williams is set to appear on a panel later today after several Fed officials noted that rate increases could accelerate.
In geopolitical news, a senior Iranian official rejected one of Washinton's key conditions for peace talks, stating that the country would not surrender "a single atom" of its enriched material.
Mohammed Bagher Ghalibaf, Iran's parliament speaker and top negotiator, has told AI Jazeera that Tehran is waiting for an official U.S. response to its seven conditions for ending war and that the Strait of Hormuz will "never return" to its status prior to the U.S.-Israel war on Iran.
Elsewhere, Russia's military said that it had carried out a massive overnight strike on military factories across Ukraine, causing explosions.
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