Gold prices dropped sharply on Tuesday, falling more than 1% and putting the metal on track for its biggest monthly decline since October 2008.
Spot gold fell 1.5% to $3,956.92 per ounce, bringing its monthly loss to 12.7%. This marks the fourth straight month of declines for the precious metal. Meanwhile, U.S. gold futures for August delivery slipped 1.7% to $3,969.30 per ounce.
The recent weakness in gold prices has been driven largely by growing expectations that the U.S. Federal Reserve could raise interest rates again in its fight against inflation.
Higher interest rates tend to reduce the appeal of gold because the metal does not generate interest or yield. As a result, some investors shift their money into assets that can provide returns when rates rise.
Gold is also heading toward its first quarterly loss since 2024 and its largest quarterly decline since the second quarter of 2013. A stronger U.S. dollar and persistent inflation concerns around the world have added further pressure to the market.
Other precious metals also moved lower during the session.
Silver fell 2% to $57.13 per ounce, while platinum dropped 1.1% to $1,557.21 per ounce. Palladium recorded a smaller decline, slipping 0.4% to $1,208.17 per ounce.
The broad sell-off across precious metals reflects growing uncertainty in financial markets as investors closely watch inflation trends, central bank policy decisions, and the direction of the global economy.
