Gold prices fell to their lowest level in 11 weeks due to the rise of the dollar and oil.

Global gold prices fell by more than 1% during trading on Wednesday, hitting their lowest level in 11 weeks, affected by the rise in the US dollar and oil prices, amid renewed military tensions between the United States and Iran, which boosted concerns about inflation and continued high interest rates.

Spot gold fell 1.8% to $4,187.59 an ounce, its lowest level since March 23, while U.S. gold futures for August delivery declined 1.7% to $4,213.40 an ounce.

This decline coincided with a rise in the US dollar, which made dollar-denominated gold more expensive for holders of other currencies, as well as an increase in oil prices by about 1% as a result of escalating hostilities between Washington and Tehran.

Tensions in the Middle East have also increased inflationary concerns, which has reinforced market expectations that the US Federal Reserve will keep interest rates high for longer, with traders anticipating a probability exceeding 70% for a rate hike by next December.

Markets are awaiting the release of US inflation data, primarily the Consumer Price Index for May, in addition to the Producer Price Index, to determine the direction of US monetary policy in the coming period.

In other precious metals, silver prices fell 1.5% to $64.43 an ounce, platinum 2.8% to $1,678.10, while palladium dropped 0.8% to $1,212.31 an ounce.

Shafaq.com