Gold Falls as Iran Escalation Drives Oil and Bond Yields Higher

Gold prices plummeted on Tuesday as a fresh round of U.S. strikes against targets in Iran escalated tensions, pushing oil and bond yields higher.

The renewed conflict has raised concerns that inflation will remain elevated, making it more likely for the Federal Reserve to increase interest rates.

Brent crude climbed above $95 a barrel, while U.S. crude rose above $91, as traders assessed the risk of a prolonged conflict disrupting energy flows through the Strait of Hormuz.

Higher oil prices can feed directly into inflation, increasing the likelihood of further tightening by the Fed.