Gold Priced In: Rate Hike Expectations Weigh Heavily on Precious Metal

Gold prices plummeted over 3.5% in two sessions following Federal Reserve Chair Kevin Warsh's comments at Jackson Hole that higher rates could follow if inflation remains elevated.

The September rate hike expectations now stand around 60-66%, which has pressured gold through higher bond yields, as it does not pay interest and is less appealing with rising Treasury yields.

Despite the sharp decline, gold still holds a 10% gain from August's strength, but faces a key technical test at $4,410. A break below this level could expose support levels of $4,320 and $4,230.