Gold extends rise as Fed rate-cut bets pressure dollar
Traders now see a Fed rate cut on Sep 17 as a near certainty, according to LSEG data, and even lay around 7% odds on a super-sized half-point reduction
[BENGALURU] Gold rose for a third straight session on Thursday (Aug 14), helped by a weaker US dollar and lower Treasury yields as traders raised bets for a US interest rate cut in September.
Spot gold was up 0.4 per cent at US$3,368.99 per ounce, as at 9.21 am. US gold futures for December delivery rose 0.3 per cent to US$3,417.80.
The US dollar languished near multi-week lows against its rivals, making gold less expensive for other currency holders. Benchmark US 10-year Treasury yields held near a one-week low.
Data released on Tuesday showed that US consumer prices increased marginally in July, increasing the chances of a Federal Reserve rate cut next month.
Treasury Secretary Scott Bessent said on Wednesday that there is a good chance of a 50-basis-point cut next month.
Traders now see a Fed rate cut on Sep 17 as a near certainty, according to LSEG data, and even lay around 7 per cent odds on a super-sized half-point reduction.
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Non-yielding gold thrives in a low-interest-rate environment.
Investors will next focus on whether Fed chair Jerome Powell offers any fresh clues on policy at the US central bank’s annual economic policy symposium in Jackson Hole, Wyoming, next week.
Focus is also on US economic data due later this week, including the US Producer Price Index, weekly jobless claims, and retail sales.
On the geopolitical front, Ukrainian President Volodymyr Zelensky said on Wednesday that he warned US President Donald Trump ahead of his talks with Vladimir Putin this week that the Russian leader is “bluffing” about his desire to end the war.
Elsewhere, spot silver edged 0.2 per cent higher to US$38.56 per ounce, platinum eased 0.1 per cent to US$1,338.33, and palladium climbed 1.3 per cent to US$1,136.70. REUTERS
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