FX.co ★ Gold Futures Settle Lower As Markets Await Rate Decisions

Gold futures settled lower on Monday amid rising speculation the Federal Reserve will announce another sharp hike in interest rates on Wednesday to fight inflation.

The Bank of England meets on Thursday, with markets split on whether the central bank will raise rates by 50 or 75 basis points ahead of a mini budget to be unveiled by the new Chancellor of the Exchequer Kwasi Kwarteng on Friday.

The Bank of Japan is scheduled to announce its policy on Thursday. The bank is expected to hold rates unchanged.

The Swiss National Bank, also set to announce its rate decision on Thursday, is expected to hike rate by 75 basis points.

The dollar climbed earlier in the day, but pared gains subsequently, limiting gold's downside.

The dollar index, which rose to 110.18 in the Asian session, was last seen hovering around 109.80, up marginally from the previous close.

Gold futures for December ended lower by $5.50 or about 0.3% at $1,678.20 an ounce.

Silver futures for December ended down by $0.023 at $19.358 an ounce, while Copper futures for December settled at $3.5125 per pound, down $0.0040 from the previous close.

CME Group's FedWatch Tool is currently indicating an 84% chance of a 75 basis points rate hike and a 16% chance of a 100 basis point rate hike.