Gold declines 1.5% amid oil gains and rising US rate hike expectations
The price of gold declined by more than 1.5%, reaching $4,223.95 per ounce amid rising oil prices and increasing expectations of an US interest rate hike, driven by bond yield pressures and rising inflation. The surge in energy costs added further pressure on the market, with the likelihood of a 66% chance of interest rate increases in October. Although gold is considered a hedge against inflation, rising interest rates increase the cost of holding it, thereby affecting demand.
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