Gold heads for weekly loss on inflation and rate fears
Spot gold fell to $4,469.59 per ounce as fading hopes for a Middle East ceasefire drove oil prices higher. Investors remain cautious as rising energy costs and a resilient U.S. economy increase the likelihood that the Federal Reserve will maintain higher interest rates through the end of the year.
Gold fell 1.5% this week to $4,469.59 per ounce as fading peace prospects in the Middle East drove expectations for higher inflation. The drop followed stalled ceasefire efforts in Lebanon and a 0.1% decline on Friday. For investors, the breakdown in diplomacy signals a prolonged period of high borrowing costs that erodes the appeal of non-yielding assets.
### Geopolitical Deadlock Fuels Inflation Fears The conflict intensified after the Hezbollah militia rejected a new ceasefire and Israel refused to withdraw its troops. These developments have undermined efforts by the United States to stabilize the region and forge a peace agreement with Iran.
