Gold edged lower in Asian trade on Monday, as investors weighed the possibility of further Federal Reserve tightening later this year. While markets broadly expect the Fed to leave interest rates unchanged at its October meeting, another increase before year-end remains a live risk, said OCBC in a client note.
The precious metal slipped as the dollar held firm and bond yields stayed elevated, pressuring non-yielding assets. Traders are pricing in just a slim chance of a move in October but remain cautious about policy guidance.
OCBC noted that any hawkish signal from the Fed could spur additional downside for gold, while a dovish tilt might help the metal rebound.
Market participants will be watching upcoming U.S. inflation data and Fed commentary for clues on the rate path through December.
Source: Wall Street Journal Markets · Summarized by HeadlinesBriefing