Gold Prices Fall to Seven-Month Low Amidst Fed Rate Hike Expectations

New York. The price of yellow metal gold has fallen to a seven-month low in the international market. Gold prices have fallen as expectations that the US central bank Federal Reserve (Fed) may raise interest rates strengthen.

On Thursday, the price of spot gold on the Comex division of the New York Mercantile Exchange fell to $3,961.95 per ounce. As of 4:57 PM Nepali time when this news was prepared, the price of gold was $3,984.05 per ounce.

This is 0.14 percent less than the closing price of the previous day. Similarly, the price of US gold futures for August delivery also fell 0.3 percent to $4,014.09 per ounce.

According to market analysts, gold has come under pressure due to the increased possibility of the Fed raising interest rates in September. According to CME FedWatch data, investors are currently estimating a 66 percent chance of an interest rate hike in September.

According to Nikos Tzavaras, a senior market analyst at Tradeweb, owned by Jefferies, the Fed's inclination towards a tighter monetary policy is the main reason for gold's current weakness.

More than 6 percent decrease in a week

Since the Fed's meeting last week, the price of gold has fallen by more than 6 percent. On Wednesday, the price of gold fell below $4,000 for the first time since November 2025. Gold, which hit a record high of $5,594.82 per ounce on January 29 this year, has now fallen about 28 percent from that level.

According to analysts, investors are withdrawing money from gold-backed exchange-traded funds (ETFs) and increasing investment in shares of artificial intelligence (AI) related companies. This has also led to a decrease in the demand for gold. However, experts say that the long-term attraction of gold still remains.

Investors are currently awaiting US personal consumption expenditure data. This is the indicator that the US central bank prioritizes for measuring inflation. As this data may provide further signals about the direction of future monetary policy, market attention is focused on it. On Thursday, the price of another precious metal, silver, however, rose 0.4 percent to $57.64 per ounce.

The price of platinum fell 0.4 percent to $1,571.95 per ounce, while palladium rose 1.6 percent to $1,184.70 per ounce.