Gold slips as strong Dollar and hawkish Fed bets weight again

Gold prices fell in early Wednesday trading, giving back some of the gains recorded during the previous session, as the precious metal continues to face pressure from a strengthening US dollar. The greenback has extended its recent gains on the back of increasingly hawkish expectations for Federal Reserve monetary policy, with markets continuing to price in the possibility of another rate hike before the end of the year. Recent comments from Fed officials have reinforced this outlook, highlighting persistent inflationary pressures and the need to maintain a restrictive monetary policy stance. Meanwhile, the recent decline in oil prices is providing some support to bullion, as easing concerns over energy-driven inflation have contributed to lower US Treasury yields. However, so far, this has not been enough to offset the impact of the stronger dollar. Against this backdrop, gold traders will keep a close eye on today's US economic data, including PMI numbers, and further comments from Fed officials, while developments in the Middle East will also remain relevant through their impact on energy prices, inflation expectations and, ultimately, the outlook for US interest rates.

Source: ActivTrader