---
title: "Will Gold decline amid a firmer dollar and possible Fed rate hikes?"
site: "Monex Precious Metals"
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last_updated: "September 21, 2026"
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---

# Will Gold decline amid a firmer dollar and possible Fed rate hikes?

“[Gold prices](https://www.investing.com/commodities/gold) retreated on Monday, pressured by a firmer dollar, while investors monitored expectations for further Federal Reserve interest rate hikes later this year.

By 09:59 ET (13:59 GMT), [spot gold](https://www.investing.com/currencies/xau-usd) had fallen by 0.7% to $4,347.96 an ounce, while gold futures had dropped by 0.9% to $4,385.70 an ounce.

“Gold edged lower at the start of the week as investors assessed the implications of the Federal Reserve’s first rate hike since 2023 and the prospect of further policy tightening,” analysts at ING said in a note.

Last week, the Fed increased rates and hinted at more to come before the end of the year, as policymakers attempt to quell energy-driven inflation. Higher rates can weigh on non-yielding assets like gold, although the yellow metal still rose last week thanks in part to a drop in oil prices.

The decline in [crude](https://www.investing.com/commodities/crude-oil) extended into Monday, fueled by hopes for diplomatic efforts in the Iran war ahead of this week’s United Nations General Assembly meeting, as well as reports of improving Gulf oil flows. 

But “comments from Fed officials reinforced concerns that inflation remains elevated, supporting expectations that rates will stay higher for longer,” the ING analysts said. Traders are now pricing in about an 88% probability that the Fed will hike rates again as soon as December, according to CME FedWatch.

Against this backdrop, the [U.S. dollar index](https://www.investing.com/currencies/us-dollar-index), which tracks the greenback against a basket of global peers, ticked up by 0.1% to 100.35. A stronger dollar can dent gold’s appeal by making it less attractive for overseas buyers.”