Gold Prices Sink Below $4,300 Amid Soaring US Yields

Gold prices declined below $4,300 on Wednesday as US Treasury yields climbed to their highest level since 2007. The precious metal has been under selling pressure amid inflation worries and expectations of a Federal Reserve interest rate hike later in the day.

The benchmark 10-year US Treasury yield rose to 5.041%, its highest level since 2007, before falling back to 5.00%. Higher Treasury yields make non-yielding assets like gold less attractive, weighing on prices.

Oil prices surged after Saudi Arabia shut down a key pipeline, further fueling inflation concerns and interest rate expectations. The US Federal Reserve is widely expected to raise the benchmark overnight interest rate by 25 basis points to the 3.75%-4.00% range.

Daniel Pavilonis, senior market strategist at StoneX, said 'higher energy prices cause more inflation. More inflation could cause higher interest rates. That's not good for gold...gold is in kind of a range-bound area. It could actually sell off more if rates continue to move higher.'