Gold Prices Plunge Amid Rising Oil Costs and Hawkish Fed Expectations

The gold price has been experiencing a bearish trend in recent days, with spot prices testing $4,253 on Monday, down more than 3% for the month and nearly 10% from August's highs of $4,696.

This sell-off was driven by rising oil prices, which pushed Brent above $108 a barrel, and hot US PPI data. The 10-year US Treasury yield also broke through the psychologically important 5% mark, its highest level since 2007, sharply raising the opportunity cost of holding non-yielding bullion.

Analysts expect the Federal Reserve to raise interest rates by 25 basis points at its meeting on Wednesday, with a probability of 92-95%. A stronger dollar added further pressure on gold.