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(Bloomberg) -- Gold fluctuated as traders assessed the outlook for the Federal Reserve’s interest-rate path on the back of potential renewed hositilities in the Middle East.The Department of State issued an ordered departure for non-emergency US government employees and their family members in Saudi Arabia only, spokesperson Tommy Pigott said on X. Earlier, a Reuters report said the ordered departure would be across the Gulf region, signaling a possible resumption of hostilities, particularly with Iran-aligned Houthi militia in Yemen. Bond yields gave up some gains while Brent oil held above $109 a barrel following Pigott’s social media post. Bullion fluctuated in response and traded up 0.2% to $4,133.32 an ounce.Gold has fallen by about a fifth since the US-Iran conflict erupted in late February. The conflict disrupted energy supplies and sent prices soaring, in turn stoking inflation and prompting central banks to tighten monetary policy. Elevated energy costs increase the possibility that the US central bank will need to further adjust monetary policy to contain price pressures. Higher rates are typically a headwind for the precious metal as it pays no interest.Traders have been trying to anticipate the Federal Reserve’s next move in its battle to keep inflation in check and have few fresh clues ahead of the central bank’s meeting next week. In a speech on Friday ahead of a communications blackout, Chair Kevin Warsh did nothing to dispel expectations that US policymakers will hold interest rates steady. The probability of a quarter-point hike implied in interest rate swaps sits at about 15%.Still, inflation is well above the central bank’s 2% target, and traders see around a 90% probability of another rate increase later in the year.Spot gold was up 0.2% at $4,133.90 an ounce as of 4:04 p.m. in New York, while silver was down 0.07% at $57.90 an ounce. Platinum and palladium also fell. The Bloomberg Dollar Spot Index was little changed.More stories like this are available on bloomberg.com©2026 Bloomberg L.P.
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