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Spot gold <XAU=> was down 0.3% at $1,706.40 per ounce, as of
0725 GMT. Earlier in the day, bullion hit its lowest level since
July 21 at $1,701.10.
U.S. gold futures <GCv1> shed 0.5% to $1,717.40 per ounce.
"I recognize it (gold) is likely to languish for some time,"
said Clifford Bennett, chief economist at ACY Securities.
"The long-term outlook for gold is positive, but first it will
experience the same general deleveraging as stocks. Gold could
fall as low as $1,600 in the meantime."
Gold prices marked a fifth monthly drop in August, their longest
run of monthly losses since 2018, as the U.S. Federal Reserve
signaled to keep borrowing costs as high as needed to quell
inflation even if it means some pain to households and
businesses. Read full storyRead full story
Euro zone inflation rose to a record high last month,
solidifying the case for further aggressive rate hikes by the
European Central Bank. Read full story
Even though gold is seen as a hedge against inflation and
economic uncertainties, higher interest rates increase the
opportunity cost of holding bullion while boosting the dollar.
Making bullion more expensive for buyers holding other
currencies, the dollar held firm close to a two-decade peak
scaled earlier this week. [USD/]
Spot silver <XAG=>, down 1% at $17.79 per ounce, hit its lowest
level in more than two years.
Silver has industrial and jewelry uses, and these sectors have
not picked up yet, said Brian Lan, managing director at
Singapore-based dealer GoldSilver Central, adding that the metal
had been overdone a little and might see a consolidation.
Platinum <XPT=> fell 0.6% to $841.45 per ounce, having earlier
hit a low since July 14. Palladium <XPD=> rose 0.4% to
$2,091.93.
(Reporting by Eileen Soreng in Bengaluru; Editing by Rashmi Aich,
Subhranshu Sahu and Sherry Jacob-Phillips)
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