Gold Futures Settle At Near 4-week Low As Dollar Climbs Higher

Gold futures extended losses to a sixth straight session and settled at near four-week lows on Monday, as the dollar moved higher amid hopes rising inflation will prompt the Federal Reserve to remain aggressive with regard to interest rate hikes in the coming months.

Richmond Fed President Thomas Barkin said central bankers were inclined towards faster, front-loaded interest rate increases, even if that meant risking a U.S. economic recession.

The dollar index climbed to 109.10 today, gaining nearly 0.9%.

The dollar has been gaining in strength in recent sessions, riding on remarks from several Federal Reserve officials that the central bank needs to be aggressive with monetary tightening to tame inflation. The focus is now on the Fed’s Jackson Hole, Wyoming, symposium, set to take place this week.

Gold futures for December settled lower by $14.50 or about 0.8% at $1,748.40 an ounce.

Silver futures September ended down $0.191 at $18.878 an ounce, while Copper futures for September settled at $3.6515 per pound, down $0.0130 from the previous close.

Bundesbank President Joachim Nagel told German newspaper Rheinischen Post that inflation in Germany could hit a 70-year high of 10 percent this fall as Russian natural-gas supplies slow.

A recession appears likely next winter but the European Central Bank should continue increasing rates to tame inflation, he added as Russia announced a three-day halt to European gas supplies via the Nord Stream 1 pipeline at the end of this month, exacerbating the region’s energy crisis.

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