Gold slips as oil prices advance, Fed rate-hike voices grow

Gold prices fell on Monday as an escalation in the Middle East war pushed Brent crude above $90 a barrel, heightening inflation concerns as several ​US Federal Reserve policymakers signalled that interest rate hikes may be ‌needed to curb price pressures.

Spot gold was down 0.4% at $4,000.55 per ounce, as of 0058 GMT, after hitting a two-week low on Friday and posting a 2.5% weekly loss. ​

US gold futures for August delivery eased 0.3% to $4,005.9.

Asian share markets ​were hesitant on Monday ahead of a packed week of major ⁠tech earnings that will further test investor faith in the AI momentum.

Oil prices jumped 3%, with Brent surpassing $90 a barrel.

The US said it had ​completed a ninth consecutive night of attacks against Iran after earlier announcing that at least two US military personnel were killed in Jordan, while U.S. allies in the region reported more ​Iranian attacks on Sunday.

Cleveland Fed President Beth Hammack added her voice to ​a growing chorus of policymakers arguing interest rates may need to rise to beat back persistent ‌inflation, ⁠setting up a charged debate at the Fed’s next meeting and the possibility of dissents at Chairman Kevin Warsh’s second meeting at the helm.

US consumer sentiment increased to a five-month high in July, but the improvement is likely temporary as ​renewed conflict in ​the Middle East ⁠raises gasoline prices.

High interest rates increase the opportunity cost of holding non-yielding assets such as gold.

COMEX gold speculators ​raised net long position by 4,294 contracts to 119,147 in ​week ended ⁠July 14, CFTC data showed.

Gold discounts in India widened last week to a one-month high as weak jewellery demand and hopes of lower prices kept buyers on ⁠the sidelines, ​while premiums in China were largely steady on ​muted retail demand.

Elsewhere, spot silver gained 0.9% to $56.42 per ounce, platinum was up 0.1% at $1,592.97 ​and palladium rose 0.3% to $1,251.74.