Gold heads for steep weekly loss as oil prices fuel Fed rate concerns

Business Recorder reported that spot gold was down 0.2% at $4,016.27 an ounce on Friday, after earlier reaching its lowest point since July 20. The metal has lost 3.5% this week, putting it on course for its sharpest weekly drop since June, while December US gold futures fell 0.7% to $4,030.40.

Higher oil prices have strengthened expectations that the Federal Reserve will keep rates elevated for longer, raising the cost of holding bullion, which does not pay interest. Investors are watching the Fed’s October 27-28 meeting and next week’s PCE inflation data; markets largely expect no rate change, while the probability of a December hike stands at 80%. Silver and platinum also declined on Friday, and palladium was little changed, with all three heading for weekly losses.