Gold Prices Tumble as Higher Oil Costs and Yields Bite

Gold prices fell on Tuesday as rising U.S. Treasury yields and stronger oil prices reduced demand for bullion, while investors awaited the minutes from the Federal Reserve's July policy meeting for further indications on interest rates.

The price of gold moved lower by 0.5% to $4,395.78 an ounce at 02:26 ET (06:26 GMT), with Gold Futures declining by the same amount to $4,451.07.

The decline in gold prices was due in part to the rising U.S. Treasury yield, which made non-yielding assets such as bullion relatively less attractive.

Oil prices strengthened after Iran warned that it would move to a 'fully offensive' military posture if diplomatic efforts with the United States failed.

The renewed instability in the Middle East kept energy markets volatile and raised concerns that sustained increases in crude prices could generate additional inflationary pressure.