Gold falls to $4,075 as the DXY recovers to 101.70 on hawkish Fed rhetoric, while WTI crude slides to $83 per barrel amid diplomatic optimism regarding the war with Iran.
The DXY regains ground to around 101.70 from an intraday low of 101.49 after Waller said he would support a 25 bps December hike and possibly a half-point move if core CPI is 0.3% or higher. ING expects the dollar to stay supported by strong growth, above-3% inflation and a Fed threatening to tighten. A hot CPI print would add further support.
WTI slips toward $83 a barrel, its lowest level since August 31, after President Trump cited 'positive momentum' toward ending the war with Iran following talks with Qatar's prime minister on Monday. Hopes for US-Iran diplomacy reduce supply-risk premiums in the price. A broader dollar recovery also weighs on commodities.
Gold prices retreated over 1% to $4,075 as hawkish comments from Fed Governor Christopher Waller bolstered the US Dollar. Waller indicated support for a 25 basis point hike in December, with a potential 50 basis point move if core CPI prints at 0.3% or higher.
Hawkish remarks from Fed Governor Waller, who supports a December rate hike and even a half-point move if core CPI comes in around 0.3% or higher, lifted the DXY back to about 101.70.
Today's US CPI release at 13:30 GMT is expected at 0.3% headline and 0.2% core; a softer reading could weaken the dollar.
WTI slipped toward $83 a barrel, the lowest since August 31, as hopes for US-Iran diplomacy grew after Trump spoke of 'positive momentum' toward ending the war following talks with Qatar's prime minister.