Gold Tumbles as Interest Rate Hike Odds Jump to 66%

Gold prices have been under pressure in recent days, hovering near their weakest level in almost two weeks. The precious metal traded around $4,450 an ounce in Asian hours on Tuesday after dipping to its lowest point since August 19 on Monday.

The decline comes as traders shift their attention from the Jackson Hole conference to a packed US labour-market calendar that could decide whether the Federal Reserve raises interest rates in September. The market now puts the probability of a September increase at about 66%, up sharply from a week earlier.

Fed Chair Kevin Warsh used the Jackson Hole event to warn that policymakers may need to tighten again if inflation fails to move convincingly towards 2%. Markets are now debating whether the Fed may need to resume tightening, with some analysts expecting two quarter-point increases before year-end.