Gold Crashes 7% in Four Sessions Amid Fed Rate Hike Odds Surge

The gold market has seen a significant downturn, with spot gold cutting through support and reaching a two-week low at $4,375. This marks a decline of 7% from last week's peak near $4,700 in just four sessions.

The cause behind this drop is largely attributed to the repricing of Fed rate hike odds, which have surged to 66.4% for the September 15-16 FOMC meeting, up from 31% at the start of the month.

Gold's decline has been mirrored by silver, which is down 2.69% from Monday's $66.55 and now sits at a year-to-date low of 8.90%.

The Federal Reserve's chairman, in his recent speech at Jackson Hole, stated that PCE inflation was at 3.7% over the past year and 4.1% annualized over the past six months, indicating a need for tightening monetary policy.