Gold drops to 3-week minimum on Fed rate hike bets
On Thursday, gold prices kept going down during European trade, sagging to another three-week minimum amid renewed expectations for a Fed rate lift later in 2016.
In New York, August delivery gold futures sagged to a session minimum of $1,310.70 per troy ounce, a value not observed since June 24. Last it traded at $1,317.05, demonstrating 0.17% fall.
Yesterday, gold 0.98%, as market participants considered buying into rising equity markets rather than buying safe-haven assets.
A recent string of positive economic reports, including June housing starts, ISM employment and manufacturing, retail sales, appeared to be better than expected, thus suggesting that economic growth regained speed during the second quarter.
The bullish data could enable the Fed to lift interest rates much sooner than previously expected. Currently, interest rate futures are pricing in a 19% chance of a rate lift by September. As for December odds, they were at 51%, compared to less than 20% last week and up from 9% at the beginning of this month.