Gold Tumbles Over 1% as Oil Prices Soar and Rate Hike Fears Intensify

Gold prices plummeted more than 1% on Monday as investors grew increasingly concerned about inflation and further interest rate hikes from the Federal Reserve. The sharp decline in gold, priced at $4,223.95 per ounce, was largely driven by a rise in oil prices, which has fueled inflation concerns.

Tim Waterer, chief market analyst at KCM Trade, attributed the downward pressure on gold to 'high bond yields and high oil price tandem' that continues to hinder its performance. He also noted that investors are closely watching US labour market and inflation data this week, including job openings, the ADP employment report, the Personal Consumption Expenditures (PCE) price index, and nonfarm payrolls.

Waterer warned that stronger-than-expected inflation or employment numbers could keep upward pressure on bond yields and weigh further on gold. Cleveland Fed President Beth Hammack also expressed concerns about high inflation risks conditioning the American public to accept elevated prices as the norm.