Gold Crumbles as Dollar Surges and Rate Hike Bets Intensify

Gold prices have dipped to their lowest level since early August, trading around $4,290 an ounce on Tuesday. This decline is attributed to a stronger US dollar and elevated Treasury yields amid rising crude oil prices.

The attack on Saudi Arabia's energy infrastructure has forced the East-West Pipeline offline, causing oil prices to remain elevated above $100 a barrel. This has heightened concerns over global supply, leading to increased geopolitical risks in the region.

Markets are pricing in a 25-basis-point rate hike by the Federal Reserve this week, with investors closely watching policymakers' guidance for signs of further tightening. The Bank of Japan is also expected to raise interest rates on Friday as it tries to mitigate the impact of elevated energy prices and persistent tensions in the Middle East.