The pressure on gold prices in global markets continued on the new trading day of the week. While ounce gold declined for the fourth consecutive trading day, approaching the 4,100 dollar threshold, gram gold in the domestic market started the day at the 6,565 TL level.
Ounce gold, which closed the day yesterday with a 0.37 percent decline at 4,125 dollars, was trading at the 4,117 dollar level as of 06:15 TSI on the morning of October 21. The ounce price, which fell to as low as 4,106 dollars in early trades, thus tested its weekly low.
The high course of oil prices and its impact on inflation expectations stand out in the retreat in gold. While the barrel price of Brent oil maintains its outlook near 110 dollars, it is assessed that the rise in energy costs could re-strengthen global inflation.
OIL AND INTEREST RATE PRESSURE
The denial of reports that an agreement to end the conflict between the US and Iran is near has supported upward pricing in the oil market. Although negotiations continue between the parties, the uncertainty regarding an agreement increases sensitivity over energy supply and prices.
Geopolitical tensions in the Middle East and Eastern Europe are also being closely monitored in the markets. Concerns regarding tanker attacks, especially around the Strait of Hormuz, keep the anxiety that there may be an interruption in oil supply alive.
Although gold can find support with safe-haven demand during periods of geopolitical risk, interest rate expectations have become more decisive in the current picture. While the US Federal Reserve is expected to keep the policy rate constant at its meeting next week, the possibility of an interest rate hike in December is also reflected in the pricing in the markets.
Gold, which does not provide interest income, can become relatively disadvantageous for investors in a high-interest environment. Analysts are monitoring the 4,066 dollar level as important support and the 4,200 dollar level as resistance for ounce gold in the short term.
News Source: 12punto
