Gold prices on Thursday as climbing oil prices heightened inflation ?worries, boosting bets for U.S. ?rate hikes and ?lifting Treasury yields and the dollar, which added more pressure on bullion.
Spot gold was down 1% at $4,500.07 U.S. per ounce. On Wednesday, bullion ?rose ?more than 1% in U.S. trading hours after ?having hit its lowest level since March 30. U.S. gold futures for June delivery lost 0.7% at $4,502.90.
Meantime, oil prices rose over 2% after Reuters reported that Iran’s Supreme Leader issued a directive that ?the country’s near-weapons-grade uranium should not be sent abroad.
Ayatollah Mojtaba Khamenei’s order could further ?frustrate U.S. President Donald Trump and complicate talks on ending the U.S.-Israeli war on Iran.
The yellow ?metal has fallen more than 15% since the ?war started in late February, which has disrupted maritime traffic through the Strait of Hormuz, lifting energy prices and stoking inflation concerns.
The dollar rose, making greenback-priced bullion more expensive for other ?currency-holders, while the U.S. 10-year Treasury bond yield resumed its climb, increasing ?the opportunity cost of holding non-yielding bullion.
Despite being an inflation hedge, gold struggles during periods of elevated interest rates.
Traders now see a 58% chance of at least one 25-basis-point interest rate hike by the U.S. Federal Reserve this year, compared with 48% a day earlier.
