Gold falls on fears that interest rates will rise in the world’s central economies

Gold falls on fears that interest rates will rise in the world’s central economies
Gold falls on fears that interest rates will rise in the world’s central economies

Gold closed robustly lower on Thursday, pressured by fears that interest rates in the world’s central economies will be higher in the near future. The precious metal is particularly sensitive to the dollar and interest rates on Treasuries, which tend to strengthen in the face of an aggressive US Federal Reserve.

On Comex, the metals division of the New York Mercantile Exchange (Nymex), gold for December delivery fell 0.98% to trade at USD 1,709.30 a troy ounce.

The most liquid precious metal contract in New York today traded at its lowest level since July 21, hitting an intraday low of $1,699.10.

Demand for the commodity slackens as the market prices a more aggressive monetary tightening by the Fed in the US, with less chance of an interest rate cut next year.

“Gold prices are in freefall and have tested the $1,700 level after another round of strong economic data suggested the Fed could deliver more rate hikes,” summarizes Oanda analyst Edward Moya.

On Thursday, the ISM industrial PMI was stable in August, contradicting analysts’ expectations for a fall. The S&P Global data fell less than expected.

In a report, Moody’s points out that gold is under pressure from the strength of the dollar and Treasuries returns amid rising interest rates in the US. In this way, the risk rating agency reduced its expectation for the price of the metal in the next 12 months.



The article is in Portuguese

Tags: Gold falls fears interest rates rise worlds central economies

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