Gold Slips as US Inflation Resurgence Raises Odds of Fed Hike The recent downturn in the gold market can be attributed to a resurgence in US inflation, which has increased the likelihood of a Federal Reserve interest rate hike.
This narrative is often perpetuated by pundits and analysts that higher interest rates spell doom for gold, but it's essential to examine the relationship between inflation, interest rates, and precious metals more closely.
US consumer prices have jumped significantly, putting pressure on the Federal Reserve to act. The central bank's dual mandate of maximum employment and price stability makes a rate hike all but inevitable.