Gold falls more than 1% on expectations of US interest rate hike

Gold prices fell more than 1% on Monday, impacted by rising oil prices which exacerbated inflation fears and strengthened expectations of a US interest rate hike. Spot gold dropped 1.5% to $4,223.95 per ounce. Traders see a 66% probability of a rate hike in October.

Gold prices fell more than 1% in Monday trading, impacted by rising oil prices which exacerbated inflation fears and strengthened expectations that the US Federal Reserve will raise interest rates again. Spot gold dropped 1.5% to $4,223.95 per ounce, while US gold futures fell by a similar margin to $4,257.90. The report quoted Tim Waterer, senior market analyst at KCM Trade, saying that rising bond yields and higher oil prices are a headwind for gold, and that the increase in oil prices amid mixed signals on flows keeps inflation at the forefront of investors' minds. The report noted that the Fed raised rates earlier this month by a quarter percentage point to a range of 3.75% to 4%, and that traders expect a 66% probability of a rate hike in October. Silver fell 2.6%, platinum 2.1%, and palladium 2.1%.