Gold Prices Crash to Seven-Week Low Amid Inflation Fears and Strong Dollar

Gold prices plummeted nearly 4% on Monday, hitting a seven-week low as concerns about inflation rose due to higher crude oil prices. The precious metal was also weighed down by a stronger US dollar and rising Treasury yields.

The spot gold price fell 3.8% to $4,121.6 per ounce, with earlier touching $4,110.5 - its lowest level since August 5. US gold futures declined 3.9% to $4,153.7.

Jim Wyckoff, a market analyst at American Gold Exchange, said 'Sharply higher crude prices could point to more persistent inflation and tighter Federal Reserve policy.'

The stronger dollar made gold more expensive for buyers holding other currencies, while rising US Treasury yields increased the opportunity cost of holding assets like gold.