Last Updated on 28/09/2026
- Gold prices slipped to around $4,215 during early Asian trading on Monday.
- Federal Reserve Bank of Cleveland President Beth Hammack expressed concerns that inflation expectations could become less anchored.
- Expectations of a more hawkish Federal Reserve continue to bolster the US Dollar, reducing demand for dollar-denominated Gold and putting pressure on bullion prices.
Gold (XAU/USD) declined to around $4,215 during early Asian trading on Monday, pressured by a stronger US Dollar and increasingly hawkish signals from Federal Reserve officials. Expectations that US interest rates could remain elevated for longer have reduced the appeal of the non-yielding precious metal.
Fed officials have indicated that additional rate increases could be necessary to bring inflation under control following September’s 25-basis-point rate hike. Cleveland Fed President Beth Hammack said inflation risks remain elevated and that monetary policy should stay restrictive. Fed Governor Michael Barr also suggested that further policy adjustments may be required, while Richmond Fed President Tom Barkin and Boston Fed President Susan Collins supported the latest rate increase amid persistent inflation pressures.
Higher interest rates generally create headwinds for Gold because the metal does not generate interest or yield, making interest-bearing assets relatively more attractive.
Market analyst Kelvin Wong of OANDA noted that expectations for a more hawkish Fed could strengthen the US Dollar and weigh on Gold prices.
Higher Oil Prices and Strong US Data Add Pressure
Gold briefly fell below $4,250 before recovering slightly as renewed tensions in the Middle East pushed oil prices higher. Meanwhile, stronger US economic data and hawkish Fed commentary reinforced expectations of further monetary tightening.
OCBC strategists noted that the market-implied probability of an October rate hike had risen above 70%, while the US Dollar strengthened. They identified oil prices and the market’s response to interest rates as key factors for Gold in the near term. A decline in energy prices or a weaker Dollar could help the metal stabilise, while rising Treasury yields could maintain downward pressure.
Technical Outlook: Gold Remains Bearish Below the 100-Day SMA
On the daily chart, XAU/USD maintains a negative short-term bias while trading below the 100-day simple moving average (SMA) and the Bollinger middle band. The price is hovering just above the lower Bollinger Band, while the RSI at 39.9 points to weakening bullish momentum without indicating deeply oversold conditions.
On the upside, the 100-day SMA near $4,300 represents the first resistance level, followed by the Bollinger middle band around $4,340. A stronger recovery could encounter resistance near the upper Bollinger Band at approximately $4,462.
To the downside, the lower Bollinger Band near $4,218 provides immediate support. A sustained break below this level could expose Gold to further losses and keep the short-term bearish bias in place while prices remain below the key moving-average and volatility-band resistance levels.
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