Gold falls to near $4,450 as inflation fears and rate hike prospects weigh on demand
Gold price (XAU/USD) tumbles to around $4,460 during the early Asian trading hours on Monday. The precious metal remains under selling pressure amid a stronger US Dollar (USD), rising bond yields and concerns about inflation linked to energy prices.
Ongoing conflicts in the Middle East push energy prices higher and reduce expectations of US interest rate cuts. This, in turn, could weigh on the non-yielding Gold in the near term. The Federal Reserve (Fed) held interest rates steady at a target range of 3.50% to 3.75% following its March meeting last week. The median "dot plot" projection still suggested one 25-basis-point (bps) rate cut later in 2026, though some officials now expect no cuts at all this year.
On the other hand, demand from major central banks could support the yellow metal. China’s official gold reserves have reached a record 2,309 tonnes, following a 16-month consecutive buying streak by the People's Bank of China (PBoC). It’s worth noting that higher demand from China could lift the Gold price as China is the world's largest precious metal producer.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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