Article content

Gold fell to the lowest in almost two weeks as a global bond selloff sent yields higher, with traders betting the Federal Reserve may need to raise interest rates to contain inflationary pressure from elevated oil prices.

Sign In or Create an Account

or View more offersArticle content

Bullion dropped as much as 2.5 per cent to the lowest since Aug. 19 as global rates climbed to the highest since 2008 and the dollar edged higher. Both are headwinds for non-yielding gold. The precious metal’s three-day decline is on pace for the longest losing streak since early July.

Article contentWe apologize, but this video has failed to load.Try refreshing your browser, or
tap here to see other videos from our team.We apologize, but this video has failed to load.Try refreshing your browser, or
tap here to see other videos from our team.Article content

Story continues below

This advertisement has not loaded yet, but your article continues below.

Article content

Gold’s decline began Friday when Fed Chair Kevin Warsh doubled down on his vow to fight inflation. The drop extended this week as renewed hostilities in the Middle East sent oil prices higher, stoking concerns over persistent price pressures. Traders ramped up their bets on rate hikes, currently pricing an almost 70 per cent chance that the Fed will boost rates by a quarter-point at its meeting this month.

Article contentArticle contentArticle content

Fed Governor Michael Barr said on Tuesday that the central bank should be prepared to raise rates if inflation fails to subside, warning price pressures are at risk of becoming entrenched after being above target for more than five years.

Article content

Gold’s weakness “is a follow-through from Warsh’s Jackson Hole speech and comments from Barr this morning on inflation,” with the renewed selloff in global bonds adding pressure on bullion, said Ryan McKay, senior commodity strategist at TD Securities.

Article content

Spot gold fell 1.7 per cent to US$4,362.57 an ounce as of 10:50 a.m. in New York. Silver dropped 2.7 per cent to US$64.79. Platinum and palladium both fell. The Bloomberg Dollar Spot Index was steady.

Article content

—With assistance from Wendy Wells, Jack Ryan and Yihui Xie.

Article content

Bloomberg.com

Article contentWe apologize, but this video has failed to load.Try refreshing your browser, or
tap here to see other videos from our team.Article contentThis advertisement has not loaded yet.Trending


  1. It’s time for Canadian income tax rates to match those of the U.S.

    Personal Finance


  2. BYD asked about taking over Canadian Stellantis plant, mayor says

    Autos

  3. Story continues belowThis advertisement has not loaded yet, but your article continues below.

  4. Bank of Canada expected to hold interest rates steady, but renewed trade war muddies economic outlook

    Economy


  5. Canadian refineries have never made so much off diesel as ‘Crackageddon’ mounts

    Energy


  6. Posthaste: How Canada’s counter tariffs will pile more pain on the economy

    News