Gold eases as higher oil prices stoke inflation concerns
GLD•Spot gold fell 0.5% to $4,120.49 an ounce as higher oil prices stoked inflation concerns. Brent crude reached $111.48 a barrel, while traders looked to next week’s Federal Reserve decision and inflation data for clues on rates.
1. Gold edges lower
Spot gold fell 0.5% to $4,120.49 per ounce by 0909 GMT, while U.S. gold futures for December delivery dropped 0.5% to $4,139.10. Oil prices advanced, with Brent at $111.48 a barrel, its highest since May 20.
2. Rate outlook in focus
Traders largely expect the Federal Reserve to leave rates unchanged at its October 27-28 meeting, with attention on its guidance about a possible December hike. Traders see a 90% chance of a December increase. The U.S. Personal Consumption Expenditures inflation gauge is due next week.
3. Inflation and other metals
ActivTrades director and CEO Ricardo Evangelista said high energy prices continued to support expectations of further monetary tightening. He said higher rates can reduce gold’s appeal relative to yield-bearing assets. Spot silver rose 0.2% to $57.1931 an ounce, platinum slipped 0.1% to $1,639.45 and palladium fell 0.9% to $1,110.06.
