Gold Prices Plummet as Rate Hike Bets Spike Amid Oil Price Surge

Gold prices fell to their lowest in nearly two weeks as investors bet the Federal Reserve may need to raise interest rates to combat inflationary pressure from rising oil prices.

The precious metal dropped by as much as 2.5% on August 31, its largest decline since early July, as global bond yields climbed to their highest level since 2008 and the US dollar edged higher.

This combination of factors presented headwinds for non-yielding gold, which has lost ground over the past three days.