Gold Holds Decline as Energy-Led Inflation Weighs on Rate Path
Gold held a decline, as elevated oil prices fueled inflation concerns and clouded the Federal Reserve’s path for interest-rate hikes.
This website’s original language is English. For translation, click the globe icon or choose Translate in the menu.
5 matching records found
Gold held a decline, as elevated oil prices fueled inflation concerns and clouded the Federal Reserve’s path for interest-rate hikes.
Barclays senior US economist Pooja Sriram said higher interest rates are a blunt tool that tighten financial conditions and hit rate-sensitive sectors such as housing and autos first. While rising Treasury yields and the bond selloff have added restraint, she said it is unclear whether conditions are restrictive enough. With oil prices rising again, further pressure on housing and auto demand could create uneven economic damage without resolving inflation. Sriram said the Fed’s approach, reflected in September meeting minutes, is focused on managing the risk that strong demand, persistent inflation or adverse supply shocks push prices higher. The Fed appears prepared to raise rates further, though she said a hike as soon as October is unlikely. (Source: Bloomberg)
US state and local government debt posted its worst month in nearly two decades after inflation concerns, fueled by the ongoing US-Iran conflict, and fears of interest-rate hikes triggered a widespread bond selloff.
The FTSE 100 fell, leading European stocks lower as rising oil prices drove bond yields higher and revived inflation concerns.
A selloff in Treasuries resumed Monday as oil rallied after President Donald Trump rejected Iran’s latest proposal to reopen the Strait of Hormuz, intensifying inflation concerns.