Gold Falls to Three-Month Low as Dollar and Yields Strengthen

Gold fell to its lowest level since early August on Monday as a stronger US dollar, rising Treasury yields, and renewed geopolitical tensions pressured the precious metal, with prices testing key technical support near $4,220. The decline follows President Donald Trump's rejection of an Iranian proposal to reopen the Strait of Hormuz, which also pushed crude oil futures higher. Gold's correlation with the US dollar index reached -0.93 over five sessions, while its relationship with the US 2-year yield tightened to -0.98, reflecting near-lockstep inverse movements with macro drivers. The US 2-year yield has risen about 55 basis points over 20 sessions, ranking in the 98th percentile of comparable moves since 1988. Analysts suggest gold's resilience is notable given the velocity of yield increases, with traders watching for a break below $4,220 support to target $4,165 and $4,115.