Rate hike bets increase, putting pressure on gold prices to fall back

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智通财经2026/09/10 14:06

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On Thursday, gold prices fell by more than 1 percent, as strong US inflation data and rising oil prices pushed market bets of a Federal Reserve rate hike next week higher, putting significant pressure on precious metals.
A senior financial market analyst at an institution stated that the Producer Price Index data indicates a pick-up in underlying inflation in the US economy to some extent, partly due to rising energy costs.
US producer prices rose roughly in line with expectations in August, but a rebound in energy product prices has sparked market concerns about persistent inflation due to this structural change.
According to the CME Group’s FedWatch tool, traders currently see a 70 percent probability of a rate hike next week, up from 62 percent prior to the data release, reflecting a clear short-term bias toward tightening policy.
However, most economists surveyed expect the Federal Reserve to keep rates unchanged at the September 15-16 meeting and for the rest of the year, showing a divergence between market expectations and institutional forecasts.
The stronger US dollar makes dollar-denominated gold more expensive for holders of other currencies, and rising benchmark 10-year US Treasury yields have further weighed on gold prices, increasing the opportunity cost of holding non-yielding assets.
Analysts added that higher bond yields reflect more persistent and higher inflationary pressures from rising oil prices, which is also an important factor behind the drop in gold prices.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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Rate hike bets increase, putting pressure on gold prices to fall back

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