Gold faces weekly decline amid dollar strength
Gold prices declined by over 2% this week due to the strength of the dollar and rising expectations of continued interest rate hikes by the U.S. Federal Reserve. This comes amid ongoing increases in U.S. Treasury bond yields and Federal Reserve officials reaffirming the need to tighten monetary policy and control inflation. Probabilities indicate a roughly 69% chance of another rate hike in October. Despite this, demand for gold as a safe haven remains strong due to geopolitical tensions and the rise in sovereign debt; however, the increase in interest rates diminishes its attractiveness as an investment.
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