ECB set to hike rates for first time in 11 years
Dollar dips 0.3 against rivals
SPDR Gold Trust holdings slip 0.3 on Wednesday

July 21 Reuters Gold prices fell on Thursday to their lowest in nearly a year, weighed down by prospects of more interest rate hikes by major central banks to tackle soaring inflation.

Although gold is seen as a hedge against inflation, rising interest rates tend to raise bond yields, increasing the opportunity cost of holding bullion that pays no interest.

Spot gold was down 0.5 at 1,687.29 per ounce, as of 0711 GMT, its lowest since early August 2021.

U.S. gold futures fell 0.6 to 1,687.30 per ounce.

Clearly inflation expectations are receding because the Fed and other central banks are embarking on aggressive tightening regime, which is undermining gold39;s appeal, said Ilya Spivak, a currency strategist at DailyFX.

The European Central Bank is set to raise interest rates for the first time in 11 years on Thursday, with a biggerthanflagged move seen as increasingly likely as policymakers fear losing control of runaway consumer price growth. 

The U.S. Federal Reserve is widely expected to raise rates by 75 basis points at its policy meeting next week. 

British inflation in June surged to a 40year peak, bolstering chances of a halfpercentagepoint rate hike by the Bank of England next month. 

Gold broke below 1,700oz as investors continue to reduce exposure to the sector ahead of central bank meetings, ANZ analysts said in a note….