Gold Prices Sink as Treasury Yields Hit Multi-Decade Highs

Gold prices are under pressure as US Treasury yields surge and markets bet on higher Federal Reserve rates. Spot gold fell to $4,111 an ounce on Monday, its lowest since August 5, amid a stalemate in US-Iran talks and rising borrowing costs.

According to Adrian Ash, head of research at BullionVault, 'Today's fresh multi-decade highs in US borrowing costs have finally seen the gold price give way.'

The rise in two-year Treasury yields has priced in a roughly 70% chance of a second consecutive Fed rate hike in October, making it more expensive to hold gold. Higher interest rates tend to weigh on gold as investors can earn higher returns on interest-bearing assets.