Gold Prices Tumble Amid Rate Hike Expectations and Soaring Oil Costs

Gold prices have declined due to expectations of a Federal Reserve interest rate hike and rising oil prices. The price of spot gold fell to $4,285.88 per ounce, its lowest level since early August, while U.S. gold futures settled 0.6% lower.

The rise in oil prices is attributed to attacks on Saudi Arabian oil infrastructure and halted Libyan oil field operations, which have intensified inflation fears.

According to Daniel Pavilonis, senior market strategist at StoneX, higher energy prices contribute to inflation, which could lead to higher interest rates, a negative factor for gold.

The Federal Reserve's rate decision is scheduled for Wednesday, with expectations of raising the benchmark overnight interest rate by a quarter point to a 3.75%-4.00% range.