London Daily

Focus on the big picture.
Thursday, Aug 28, 2025

Gold drops as inflation risks after OPEC+ oil target cut raise Fed hike odds

Gold drops as inflation risks after OPEC+ oil target cut raise Fed hike odds

Gold prices slid on Monday after a surprise announcement from the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, about a cut to oil output sparked inflation concerns and raised bets of an interest rate hike at the US Federal Reserve’s upcoming May meeting, according to Reuters.
Spot gold was down 0.6 percent at $1,956.89 per ounce, as of 0709 GMT, its lowest in nearly a week. US gold futures shed 0.7 percent to $1,971.30.

The opportunity cost of holding non-yielding bullion rises when interest rates are increased to lower inflation.

Gold has fallen “as investors weigh up the lure of gold as a safe-haven asset, versus the potential for higher-for-longer interest rates. Clearly, fears of inflation and higher interest rates has won the argument,” said Matt Simpson, senior market analyst at City Index.

Oil prices surged after Saudi Arabia and other OPEC+ oil producers announced a round of output cuts, a potentially ominous sign for global inflation just days after a slowdown in US price data had boosted market optimism.

US consumer spending rose moderately in February and showed signs of cooling, even though it remained elevated.

“Gold is now vulnerable to a move down to $1,900, given the potential for a higher terminal Fed rate that markets are currently pricing in,” Simpson added.

Markets now see a 60.9 percent chance of the Fed hiking rates by a quarter point in May which, in turn, has lifted the US dollar and Treasury yields.

ANZ, in a note, observed gold’s “safe-haven demand easing as the US banking turmoil eased.”

Bullion had risen by nearly 8 percent last quarter after the recent global banking turmoil drove bets that the Fed would tone down its rate hike approach.

Standard Chartered analyst Suki Cooper said in a note that gold buying by central banks might “not be as strong as it was in 2022.”

Spot silver slipped 1.6 percent to $23.69 per ounce, platinum lost 0.5 percent to $986.83, and palladium fell 0.4 percent to $1,455.16.
Comments

Oh ya 2 year ago
Gold on sale? Great back the truck up. If you have any idea where the economy is headed you know you need some gold and silver stored outside the banking system. ie safety deposit boxes

Newsletter

Related Articles

0:00
0:00
Close
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Argentine President Javier Milei Evacuated After Stones Thrown During Campaign Event
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Starmer Should Back Away from ECHR, Says Jack Straw
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
Chinese AI Chipmaker Cambricon Posts Record Profit as Beijing Pushes Pivot from Nvidia
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Welcome to The Definition of Insanity: Germany Edition
Just a reminder, this is Michael Jackson's daughter, Paris.
Spotify’s Strange Move: The Feature Nobody Asked For – Returns
Manhunt in Australia: Armed Anti-Government Suspect Kills Police Officers Sent to Arrest Him
China Launches World’s Most Powerful Neutrino Detector
How Beijing-Linked Networks Shape Elections in New York City
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
2 Australian Police Shot Dead In Encounter In Rural Victoria State
Vietnam Evacuates Hundreds of Thousands as Typhoon Kajiki Strikes; China’s Sanya Shuts Down
UK Government Delays Decision on China’s Proposed London Embassy Amid Concerns Over Redacted Plans
A 150-Year Tradition to Be Abolished? Uproar Over the Popular Central Park Attraction
A new faith called Robotheism claims artificial intelligence isn’t just smart but actually God itself
Deputy Prime Minister Angela Rayner Purchases Third Property Amid Housing Tax Reforms Debate
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Italian Facebook Group Sharing Intimate Images Without Consent Shut Down Amid Police Investigation
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
Sam Nicoresti becomes first transgender comedian to win Edinburgh Comedy Award
Builders uncover historic human remains in Lancashire house renovation
Australia Wants to Tax Your Empty Bedrooms
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
FBI Investigates John Bolton Over Classified Documents in High-Profile Raids
Report reveals OpenAI pitched national ChatGPT Plus subscription to UK ministers
Labour set to freeze income tax thresholds in long-term 'stealth' tax raid
Coca‑Cola explores sale of Costa coffee chain
Trial hears dog walker was chased and fatally stabbed by trio
Restaurateur resigns from government hospitality council over tax criticism
Spanish City funfair shut after serious ride injury
Suspected arson at Ilford restaurant leaves three in critical condition
Tottenham beat Manchester City to go top of Premier League
Bank holiday heatwave to hit 30°C before remnants of Hurricane Erin arrive
UK to deploy immigration advisers to West Africa to block fake visas
×