Gold Set for Worst Week in 4 Decades as War Curbs Rate-Cut Bets

Gold headed for its biggest weekly loss since 1983, as war in the Middle East boosted energy prices and reduced expectations for interest-rate cuts.

Bullion’s decline deepened as the dollar and bond yields rallied after CBS reported that the US is preparing to potentially deploy ground forces into Iran. Traders increased their bets on rate hike to 50% by October amid concern that a protracted conflict could stoke inflation. Higher rates hurt gold as it doesn’t pay interest.