Gold Prices Plummet Amid Rising Oil Costs and Rate Hike Expectations

Gold prices plummeted more than 2% on Monday as rising oil prices fueled inflation concerns and reinforced expectations of further Federal Reserve interest-rate hikes.

Spot gold fell to its lowest since early August, trading at $4,171.85 per ounce, while US gold futures dropped 2.7% to $4,204.30.

Tim Waterer, chief market analyst at KCM Trade, attributed the decline in gold prices to the 'high bond yields and high oil price tandem' that continues to affect gold's performance.

The Fed raised interest rates earlier this month, and traders are now pricing in a 69% chance of a US rate hike in October, according to CME's FedWatch Tool.