Gold slipped below $4,100 an ounce on Friday, breaking a two-session winning streak, but remained on course for its first monthly advance in five months. The metal drew support this week after the US Federal Reserve left interest rates unchanged, even as inflationary pressures intensified amid renewed conflict in the Middle East. Still, expectations of tighter monetary policy continued to limit the upside, with markets currently assigning roughly a 63% probability to a Fed rate hike in September.
At the same time, the US military launched new strikes on Iranian targets in response to Tehran’s attacks on US assets across the Middle East, further dimming prospects for any near-term diplomatic breakthrough. Gold has faced persistent pressure since the US-Iran war erupted in late February, as surging oil prices have stoked inflation concerns and reinforced expectations of more restrictive monetary policy.
