Gold Hits $4,360 as Oil Slump Cools Fed Hike Odds
Bullion reverses a weekly loss to $4,360 as falling crude prices lower inflation risks and shift Federal Reserve policy expectations.
Key points
- Gold edged up to 4,360 dollars per ounce after reversing its steepest weekly decline.
- Crude oil prices fell more than nine percent over four days due to eased geopolitical tensions.
- Bullion-backed ETFs attracted approximately fifty tons of inflows in September, marking a third straight monthly gain.
Gold prices climbed to approximately 4,360 dollars per ounce on Tuesday. This move reversed the steepest weekly decline seen in the past week.
The rally followed a sharp drop in crude oil costs. Lower energy prices reduced fears of persistent inflation, which benefits non-yielding assets like bullion.
Oil Prices Drop Nine Percent
Crude oil futures lost more than nine percent over four trading days. This decline stemmed from eased concerns over Middle East export disruptions.
Diplomatic efforts to end the conflict between the US and Iran also contributed to the price drop. President Donald Trump indicated openness to meeting Iranian President Masoud Pezeshkian at the United Nations.
Fed Officials Warn On Inflation
Federal Reserve policymakers maintained a hawkish stance despite the oil price drop. Chicago Fed President Austan Goolsbee stated the bank must respond to persistent supply shocks.
St. Louis Fed President Alberto Musalem argued that additional rate hikes may be necessary. The central bank has failed to meet its inflation target for over five years.
ETF Inflows Hit Fifty Tons
Bullion-backed exchange-traded funds recorded roughly fifty tons of inflows in September. This marks the third consecutive month of net gains for these products.
TD Securities analysts noted that near-term weakness is viewed as a buying opportunity. According to Yahoo! Finance Canada, the broader precious metals landscape remains favorable despite the recent rate hike.
