Gold Price Tumbles As Fed Official Sees Gradual Rate Hikes

New York (June 26)  Gold futures fell sharply Monday morning amid increased risk appetite, as traders bet on stocks and a rebound in oil prices. A stronger dollar also dented the precious metal.

The Commerce Department's Durable Goods Orders for May will be announced at 8.30 am ET. Economists are looking for a decline of 0.4%, after a more significant drop of 0.7% in April.

The Chicago Fed national activity index for May is also out at 8:30 a.m.

San Francisco Federal Reserve Bank President John C. Williams spoke in Australia overnight. He sees one more interest rate hike this year and three to four next year despite sluggish inflation.

However, last week St. Louis Fed President suggested the Fed should keep rates on hold: "The Fed can wait and see how the economy develops before making any further adjustments to the policy rate."

Gold is likely to snap a rare 3-day win streak. August gold was down 14 dollars at USD1242 an ounce, near its lowest in more than a month.

Silver also tumbled, losing 18 cents to USD16.52 an ounce.

Source: AllianceNews