XAU/USD falls for a third day as USD strengthens on Fed hawkishness and elevated Treasury yields.
Gold prices extended losses during Friday’s Asian session, hitting a one-week low around $4,121 as the USD maintained its bullish momentum. The Federal Reserve’s hawkish stance, with nine of 19 members projecting a rate hike this year, weighed on non-yielding bullion.
The Fed held rates steady at 3.5%-3.75% but signaled persistent inflation concerns, with Chair Kevin Warsh emphasizing price stability. Markets now price a 70% chance of a September hike, keeping Treasury yields elevated and supporting the USD.
Geopolitical uncertainty, including stalled US-Iran negotiations, further bolstered the USD’s reserve status, adding pressure on gold.