Probability of a 25-Basis-Point US Rate Hike in September Reaches 66%, Weighing on Gold

In early September 2026, financial markets estimated a 50% to 66% probability that the US Federal Reserve would raise interest rates by 25 basis points during its scheduled meeting this month, which renewed pressure on gold prices that had already fallen back from their record levels.

These expectations come amid conflicting economic indicators, as the US labor market continues to show remarkable resilience despite slowing wage growth, keeping the door open for further monetary tightening.

Rising interest rates exert direct pressure on gold from two angles: they increase the opportunity cost of holding a non-yielding metal, and they bolster the US dollar, whose movement typically reflects an inverse trend to gold prices.

If the rate hike is confirmed, analysts expect pressure on gold to extend toward the $4,100–$4,200 per ounce levels, a support zone closely watched by investors. Expectations remain contingent on upcoming US inflation data prior to the meeting.

What Do These Terms Mean?

Basis Point: A unit of measurement for changes in interest rates equal to 0.01%, meaning that 25 basis points represent a quarter-percentage-point increase in interest rates.

Federal Reserve: The central bank of the United States of America, responsible for setting interest rates and managing monetary policy for the US economy.

Opportunity Cost: The gain an investor foregoes when choosing one asset over another; when interest rates rise, bank deposits become more attractive than holding gold, which pays no interest.