Gold, Bitcoin Prices Plummet Amid Rising US Inflation Expectations

Gold and Bitcoin prices plummeted after US producer inflation data showed a 5.4% annual increase, pushing Treasury yields higher and raising expectations for a Federal Reserve rate hike in September to about 70%. The sharp rise in real yields made non-yielding assets like gold and Bitcoin less attractive.

Despite record institutional demand for gold ETFs, with $18 billion inflows in August, investors became wary of holding onto these assets. The increase in Treasury yields near 5% makes government bonds more appealing compared to gold and Bitcoin, which do not generate yield.