Gold Price Plummets Over 3.4% as Treasury Yields Soar to 2007 Levels

The price of gold plummeted by over 3.4% on Monday as US Treasury yields surged to their highest level since June 2007, reaching 5.27%. This sudden increase in yields has sparked a brutal sell-off in the market, overwhelming any bullish sentiment for bullion.

Despite oil prices remaining elevated at $93.00 per barrel, the gold price continued its downward trend, falling from its peak of $4,280 to $4,139. The mixed news headlines about a potential US-Iran deal and officials denying those claims have kept financial markets volatile.

The Fed's hawkish stance on inflation has further contributed to the sell-off, with Governor Lisa Cook expecting continued inflationary pressure in the coming months due to AI and hostilities in the Middle East. The chances of additional interest rate hikes have increased, with money markets pricing in a 65% chance of a 25-basis-point rate hike at the October meeting.