EUR/USD
1.16161
-0.145%
Gold
4371.47
-0.683%
Oil
96.433
2.357%
USD/JPY
154.100
0.359%
GBP/USD
1.35169
-0.215%
GBP/JPY
208.300
0.162%
Real-time News
Gold prices fell more than 1% on Thursday as strong U.S. inflation data and rising oil prices increased market bets on a Federal Reserve rate hike next week. Kyle Rodda, senior financial markets analyst at Capital.com, said the producer price index data tells us that underlying inflation in the U.S. economy is picking up, partly due to rising energy costs. U.S. producer price increases in August were largely in line with expectations, but energy prices rebounded. According to the CME FedWatch Tool, traders now expect a 70% probability of a rate hike next week, up from 62% before the data release. However, most economists surveyed by Reuters expect the Fed to keep rates unchanged at its September 15-16 meeting and for the remainder of the year. A stronger dollar makes dollar-denominated gold more expensive for holders of other currencies, while rising yields on benchmark 10-year U.S. Treasury bonds further pressured gold prices. Rodda added that higher bond yields reflect more persistent and higher inflationary pressures from rising oil prices, which also contributed to the decline in gold prices. Rising bond yields typically increase the opportunity cost of holding non-yielding assets, thus putting downward pressure on gold.According to Irans Tasnim News Agency, the Houthi rebels in Yemen have seized control of the city of Zubair in Iraq and Zuqar Island, a strategic location near the Bab el-Mandeb Strait.On September 10th, Massimo Spadotto, head of fixed income at Eurizon, stated that it is "entirely possible" for the European Central Bank (ECB) to raise its deposit rate to 2.75% at one of its last two meetings this year. He added that, given the current situation, another rate hike should likely be considered the baseline scenario, although it is by no means a certainty. Spadotto said, "It largely depends on the movement of commodity prices, which will naturally be affected by the development of the (Middle East) conflict." He added, "However, the market has already fully priced in the expectation of two more ECB rate hikes this year. Therefore, these rate hikes themselves should not put pressure on the market, but rather could trigger a sell the rumor, buy the fact scenario."European Central Bank President Christine Lagarde concludes press conference.ECB Governing Council member Nagel: Eurosceptic parties will discourage investors from investing in Germany.
