Gold Sinks to Seven-Week Low Amid Rate Hike Pressure and US-Iran Tensions

Gold prices plummeted to a seven-week low as pressure mounts for interest rate hikes. The precious metal has dropped around 7% in September after the Federal Reserve raised rates for the first time since 2023 to combat US inflation.

The ongoing US-Iran tensions, rising energy costs, and the possibility of further rate increases have weighed on gold prices. Bullion was trading around $4,125 an ounce, down 4% from Monday's level.

Fed Governor Lisa Cook warned that future productivity gains from artificial intelligence may not offset near-term price pressures, potentially driving up inflation across the economy.