Gold prices drop as energy costs fuel rate hike fears
Spot gold fell to $4,526.86 per ounce as rising oil prices and geopolitical tensions between the U.S. and Iran increased inflation expectations. Markets are now pricing in a potential Federal Reserve rate hike in December, which has weighed on non-yielding bullion while UBS lowered its year-end price target.
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Gold fell 1% to $4,526.86 as investors bet on higher interest rates following military tensions in the Middle East. The decline follows United States strikes on Iran that pushed energy prices higher and fueled inflation fears. Rising yields reduce the appeal of non-interest-bearing bullion, forcing a shift in portfolio allocations toward cash and bonds.
