Gold falls 3.5% to $4,121 as Fed rate-hike bets and Treasury yields weigh

Gold fell over 3.5% on Monday to around $4,121, its lowest since August 5, as expectations of further Federal Reserve rate hikes and surging Treasury yields weighed on the metal. Elevated oil prices, driven by the US-Israel strikes on Iran and supply disruptions, have pushed bond yields to multi-year highs, raising the opportunity cost of holding gold. Markets see a 70% chance of an October rate hike after the Fed's September increase. Gold has dropped about 27% from its January peak near $5,600, with the 10-year Treasury yield at 5.27%, its highest since 2007. Key US economic data this week could provide fresh direction.