XAU/USD falls to a daily low near $4,650 amid USD demand fueled by Fed hike bets and geopolitical tensions.
Gold (XAU/USD) extended intraday losses, slipping below $4,650 during Monday’s European session as the US Dollar (USD) rallied. Persistent geopolitical risks, particularly renewed Iran-US hostilities, bolstered the USD’s reserve currency appeal, diverting flows from non-yielding assets like gold.
Expectations of a more hawkish Federal Reserve, supported by upbeat US employment data and rising inflation concerns, further strengthened the USD. Iran’s rejection of US nuclear demands and escalating tensions in the Strait of Hormuz kept geopolitical risks elevated, pressuring gold prices.
Crude oil prices rose on the latest developments, reinforcing inflation fears and supporting the case for tighter Fed policy. The combination of geopolitical uncertainty and monetary policy expectations weighed on gold’s appeal as a safe-haven asset.