FX.co ★ Gold Slips as Markets Reassess Fed Outlook

Gold slipped below $4,050 an ounce on Thursday, erasing the previous session’s gains as traders reassessed the Federal Reserve’s policy outlook after it left interest rates unchanged. Three FOMC members dissented in favor of a rate hike, while Chair Kevin Warsh stressed that holding rates steady should not be interpreted as policy inertia, noting that markets will remain highly sensitive to incoming economic data. Market pricing now implies roughly a 67% probability of a 25-basis-point Fed rate increase in September, up from 56% a day earlier, while expectations for a larger 50-basis-point hike have largely faded. Gold was also pressured by a rally in oil prices after the US launched a new round of strikes against Iran in response to attacks on American forces across the Middle East, heightening concerns over potential disruptions to global energy supplies.