Gold retreats on stronger dollar; traders brace for Fed
GLD•Spot gold fell 0.5% to $3,995.89 per ounce as the dollar strengthened ahead of the Federal Reserve’s decision. Traders priced in an 80% chance of a rate hike in December.
1. Gold falls as dollar rises
Spot gold fell 0.5% to $3,995.89 per ounce by 0929 GMT, while U.S. gold futures for December delivery dropped 0.71% to $4,009.60. The dollar rose 0.3%, reaching a near two-week high, making dollar-priced gold more expensive for holders of other currencies.
2. Fed and inflation in focus
The Federal Reserve is expected to hold rates steady on Wednesday, while traders price in an 80% chance of a rate hike in December. Investors are also awaiting U.S. Personal Consumption Expenditures data on Thursday. ActivTrades director and CEO Ricardo Evangelista said a hawkish Fed message or stronger-than-expected inflation could push gold below $4,000, potentially toward $3,900.
