Gold falls to lowest level in over three weeks as oil rises

Gold prices fell to their lowest level in more than three weeks on Wednesday, as escalating conflict in the Middle East pushed oil prices higher, fueling concerns over inflation and interest rate hikes, while investors focused on upcoming US jobs data.

Spot gold dropped 0.6 percent to $4,304.01 per ounce, its lowest since August 7. The metal is on track for a fourth consecutive session of losses. US gold futures for December delivery fell 1 percent to $4,350.80 per ounce.

According to Reuters, Bas Kooijman, CEO and asset manager at DHF Capital SA, said that renewed tensions between the United States and Iran have driven oil prices higher, increasing inflation fears. He noted that continued gains in crude prices could tighten monetary policy expectations and push yields higher, limiting any potential recovery for gold.

The CME Group's FedWatch tool shows traders currently see a 67 percent chance of an interest rate hike at this month's US Federal Reserve meeting.

Among other precious metals, spot silver fell 1 percent to $63.60 per ounce, platinum dropped 1 percent to $1,722.23, and palladium declined 1.4 percent to $1,292.21.