Gold prices fell on Monday to extend last week’s tumble as the dollar extended its climb amid angst over global growth.
Spot gold fell 0.7 percent to $1,735.59 per ounce, while U.S. gold futures were down 0.8 percent at $1,748.45.
The dollar resumed its rally to hover near five-week high after another Federal Reserve official flagged the likelihood of continued aggressive monetary tightening.
Richmond Fed President Thomas Barkin said central bankers were inclined towards faster, front-loaded interest rate increases, even if that meant risking a U.S. economic recession.
Elsewhere, Bundesbank President Joachim Nagel told German newspaper Rheinischen Post that inflation in Germany could hit a 70-year high of 10 percent this fall as Russian natural-gas supplies slow.
A recession appears likely next winter but the European Central Bank should continue increasing rates to tame inflation, he added as Russia announced a three-day halt to European gas supplies via the Nord Stream 1 pipeline at the end of this month, exacerbating the region’s energy crisis.
Unease over China’s economy tipped the yuan to its lowest level in nearly two years after the country’s central bank cut its key lending rates again in a bid to boost the economy hurt by extended COVID-19 lockdowns and property debt problems.
The one-year loan prime rate was reduced by 5 basis points to 3.65 percent and the five-year LPR was cut by 15 basis points to 4.30 percent.
The Federal Reserve’s Jackson Hole Symposium is due this week, where policymakers are expected to strike hawkish tone on future rate hikes.
Federal Reserve Chair Jerome Powell will speak at the Jackson Hole meeting on Friday.
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