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Gold Falls After Fed Signals Raise Odds of September Rate Hike

Markets priced higher US interest rates after Fed chair Kevin Warsh said more action may be needed to curb inflation, pushing Treasury yields higher, reducing demand for non‑yielding gold.

Overview

  • Global spot gold slid into the mid‑$4,300s after markets sharply raised the probability of a September Fed hike following comments by Kevin Warsh.
  • Traders moved to price faster tightening, which lifted the 10‑year Treasury yield toward about 4.78% and strengthened the dollar, making gold less attractive versus interest‑bearing assets.
  • Local bullion markets in South Asia tracked the international drop, with New Delhi quotes near Rs 158,200 per 10 grams and Pakistani tola rates falling by hundreds of rupees.
  • Structural support for the metal remains: global gold ETFs recorded roughly $18.9 billion of inflows over the past 12 months and a liquidity‑based model cited by analysts values gold near $5,025 an ounce.
  • What to watch next: US inflation and jobs reports plus Fed communications that could reverse or deepen the repricing and therefore decide if gold rebounds or keeps sliding.