Gold Prices Plummet Amid US-Iran Tensions and Rate Hike Fears

Gold prices hit their lowest level in over three weeks on Wednesday due to escalating tensions between the US and Iran. The conflict has pushed up oil prices, fueled inflation concerns, and led investors to anticipate a possible rate hike by the Federal Reserve.

The price of spot gold fell 0.2% to $4,321.31 an ounce at 0639 GMT, while US gold futures for December delivery dropped 0.6% to $4,368.50. The US dollar remained firm, making dollar-priced metals more expensive for buyers using other currencies.

Bas Kooijman, CEO and asset manager at DHF Capital S.A., attributed the decline in gold prices to a rebound in oil prices after renewed U.S.-Iran tensions added to inflation concerns. He also noted that traders are pricing in a 70% chance of a rate hike at the Federal Reserve's policy meeting this month.