XAU/USD falls for a third day as markets price a 77% chance of a Fed rate increase in October amid hawkish signals.
Gold prices dropped to a one-week low of $4,121, extending losses for a third straight session. The decline comes despite a softer US Dollar, as rising bets on Federal Reserve rate hikes weigh on the precious metal. Futures markets now assign a 77% probability of a rate hike in October, up from under 40% last week.
The Fed held rates steady this week but signaled solid economic activity and labor market improvement. Nearly half of policymakers project at least one rate hike in 2026, reinforcing a hawkish stance. Gold’s technical outlook remains bearish, with the RSI below 50 and MACD in negative territory.
Trading at $4,147.83, XAU/USD shows a sequence of lower highs and lows, with support eyed at $4,023. The Juneteenth holiday has muted market activity, but Fed tightening expectations continue to cap rallies.