Gold prices dropped more than 2% on Tuesday to a two-week low as elevated Treasury yields and a stronger U.S. dollar weighed on the market. Spot gold fell 2.7% to $4,329.47 per ounce after touching its lowest level since August 19 at $4,362.89. The decline accelerated after bullion broke below its 200-day moving average, currently around $4,528, triggering technical selling. U.S. gold futures declined 2.3% to $4,377.40.

Jim Wyckoff, a market analyst at American Gold Exchange, noted that global bond yields at multi-year highs are pressuring gold. Rising U.S. Treasury yields, which hit their highest since January 2025, increase the opportunity cost of holding non-yielding gold. The stronger dollar also makes gold more expensive for overseas buyers.

Gold had hit a more than three-month high last week before sliding over 3% on Friday after Federal Reserve Chair Kevin Warsh warned of more "work to do" on inflation. Traders now see a 68% chance of a September rate hike, according to CME's Fed Watch Tool. Investors await the ADP employment report Wednesday and non-farm payrolls Friday for further policy clues. Wyckoff expects gold to trade sideways to lower in the near term.