Gold Price Slips as Oil Spike, Fed-Hike Odds Boost Treasury Yields

Spot gold prices fell by 0.18% on Monday, while spot silver rose modestly, as oil prices surged and Fed-hike odds increased.

The rise in oil prices was sparked by renewed US-Iran military escalation, which pushed long-end Treasury yields higher and put pressure on non-yielding metals.

North American equity markets closed lower, with the S&P 500 falling 0.3%, the Dow Jones Industrial Average dropping 0.7%, and the Nasdaq Composite slipping 0.1%.

The Fed-funds futures priced a 66.1% probability of a September rate hike, up from 57% on Friday, as traders treated Chair Kevin Warsh's hawkish speech and Monday's oil shock as reinforcing the Fed's inflation problem.