Gold slips as oil gains strengthen case for elevated interest rates

| | | | --- | --- | | DATA/EVENTS (GMT) | | | 0200 | China Urban Investment (YTD) YY Aug | | 0200 | China Retail Sales YY Aug | | 0200 | China Unemp Rate Urban Area Aug | | 0430 | Japan Tertiary Ind Act NSA Jul | | 0600 | UK Claimant Count Unem ChngAug | | 0600 | UK ILO Unemployment Rate Jul | | 0600 | UK HMRC Payrolls Change Aug | | 0645 | France CPI (EU Norm) Final MM, YY Aug | | 0645 | France CPI YY, MM NSA Aug | | 0900 | EU Total Trade Balance SA Jul | | 0900 | Germany ZEW Economic Sentiment Sep | | 0900 | Germany ZEW Current Conditions Sep | | 1000 | EU Reserve Assets Total Aug | Gold fell on Tuesday, as rising crude oil prices heightened inflation worries and reinforced U.S. rate-hike expectations ahead of a Federal Reserve policy meeting. * Spot gold XAU= was down 0.3% at $4,285.91 per ounce, as of 0015 GMT, after hitting its lowest in more than a month in the previous session. U.S. gold futures GCcv1 for December delivery were down 0.6% at $4,326.90. * The U.S. central bank will announce its policy decision at 2 p.m. EDT (1800 GMT) on Wednesday following the end of a two-day meeting. * Financial markets are betting heavily that Fed policymakers will lift their benchmark rate a quarter of a percentage point to a 3.75%-4.00% range and signal further tightening ahead. * Data on Friday showed U.S. consumer prices accelerated in August, while a key measure of underlying inflation posted its largest increase in four months. * Yemen's Iran-aligned Houthis launched a new attack on Saudi Arabia on Monday and Gulf Arab states postponed planned talks with Iran, raising concerns the Middle East conflict could spread further and threaten global oil supplies. * Oil prices extended gains. Higher energy costs can fuel inflationary pressures across the economy. * Though seen as a hedge against inflation and geopolitical risks, gold often loses appeal when rates increase as they raise the opportunity cost of holding non-yielding bullion. * Benchmark 10-year Treasury yields hit the key psychological level of 5% on Monday for the first time since October 2023. The milestone is a threshold that analysts say could ripple through the U.S. economy and threaten the bull market in stocks by denting the relative appeal of U.S. equities. US/ * Spot silver XAG= fell 0.4% to $62.99, platinum XPT= lost 0.4% at $1,752.85 and palladium XPD= ticked 1% lower to $1,279.75.

Gold slips as oil gains strengthen case for elevated interest rates

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Gold weakens as oil and inflation worries support rate-hike bets

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DATA/EVENTS (GMT)
0200	China Urban Investment (YTD) YY Aug
0200	China Retail Sales YY Aug
0200	China Unemp Rate Urban Area Aug
0430	Japan Tertiary Ind Act NSA Jul
0600	UK Claimant Count Unem ChngAug
0600	UK ILO Unemployment Rate Jul
0600	UK HMRC Payrolls Change Aug
0645	France CPI (EU Norm) Final MM, YY Aug
0645	France CPI YY, MM NSA Aug
0900	EU Total Trade Balance SA Jul
0900	Germany ZEW Economic Sentiment Sep
0900	Germany ZEW Current Conditions Sep
1000	EU Reserve Assets Total Aug