Gold Prices Slump Amid Rising Rate Hike Expectations

Gold prices dropped on Thursday as investors worried about further interest rate hikes from the US Federal Reserve. Spot gold fell 0.3% to $4,274.79 per ounce by 0702 GMT. US gold futures for December delivery also declined 0.2% to $4,309.80.

Ross Maxwell, chief strategy officer at VT Markets, said investors are focused on the Fed's 'higher-for-longer' stance and fluctuations in the US dollar and Treasury yields. He added that a clearer signal of another rate hike would put pressure on gold prices lower.

Oil prices continued to rise after climbing 4% in the previous session due to diplomatic talks between the United States and Iran showing no concrete progress. This has pushed investors towards a rate hike, which would negatively impact gold's appeal as an inflation hedge.