Gold Pressured by Inflation Despite Yield Drop and Oil Reversal

Gold prices fell Tuesday despite lower Treasury yields, as inflation worries and expectations of further Fed tightening outweighed supportive factors. Silver advanced, while crude oil reversed sharply after reports of possible U.S.-Iran diplomatic moves over the Strait of Hormuz.

Housing data confirmed ongoing weakness, with starts declining 5.2% and pending sales dropping 7.3%. CPI and PPI readings beat forecasts, keeping inflation concerns alive even as markets priced an 83% chance of a Fed pause in October and a 92-94% probability of a December hike.

The 10-year yield eased 1.9 basis points, yet gold failed to attract buyers. The oil retreat reduced some inflationary pressure, and equity markets closed higher on strong corporate earnings.