Gold fell on September 15 morning and is trading just below $1,700 a troy ounce on expectations that the US Federal Reserve (Fed) will not slow down the pace of monetary tightening, reported from the auction data.

December gold futures on the New York Comex dropped $9.95, or 0.58%, to $1,699.15 a troy ounce. December silver futures fell 0.44% to $19.483 an ounce.

Markets again turned to the Fed’s monetary policy, expecting that the regulator will raise the discount rate at the next meeting on September 20-21. According to the CME Group, 70% of analysts expect an increase of 0.75 percentage points, while the remaining 30% of experts allow an acceleration in the rate of increase to 1 percentage point. This rate is at around 2.25-2.5% per annum after two summer increases of 0.75 percentage points.

Investors began to allow acceleration in the rate of increase in the refinancing rate in the US after the publication of annual inflation statistics, which turned out to be higher than expected. The indicator fell to 8.3% in August from 8.5%, although it was forecasted at around 8.1%. Inflation remains well above the Fed’s 2% target.

The tightening of monetary policy in the US, in particular, is fraught with an increase in the yield of US government debt, which acts as an alternative direction to gold for "safe” investments.

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