Gold Down as Investors Remain Concerned Over Interest Rate Hikes
2022.07.22 07:10
By Doris Yu
Investing.com – Gold was down on Friday morning in Asia as investors are concerned about interest rate hikes by major central banks to curb inflation.
Gold futures inched down 0.03% to $1,689.05 by 12:01 AM ET (4:01 AM GMT). The dollar, which normally moves inversely to gold, inched up on Friday morning.
“Gold is in a downtrend and the rallies that are setting in are short-lived because gold is being pressured by the fact that inflationary expectations are coming down,” Edward Meir, an analyst with ED&F Man Capital Markets, told Reuters
The European Central Bank hiked interest rates by 50 basis points on Thursday to contain soaring inflation.
The U.S. Federal Reserve is widely expected to raise interest rates by 75 basis points at its July 26-27 policy meeting.
“We waiting to hear how hawkish will their (Fed) guidance be on rates. If they still think inflation is a problem or going to still ram through more interest rate hikes, that’s going to be very bearish for gold,” Meir said.
The U.S. economy is slowing as data on Thursday showed the U.S. weekly initial jobless claims rose to a fresh eight-month high and factory activity for July slumped.
In other precious metals, spot silver fell 0.3%, platinum gained 0.3%, and palladium rose 0.2%.
