FX.co ★ Gold Prices Decline On Rate-hike Concerns

Gold prices fell sharply on Monday after the world's top central bankers delivered a stern and unified message on the need to curb inflation in Jackson Hole this weekend.

Spot gold fell about 1 percent to $1,721.92 per ounce, while U.S. gold futures were down 1 percent at $1,732.85.

The U.S. two-year treasury yield hit its highest in 15 years as markets priced in higher odds of a 75 bps Fed rate hike at the Sept. 20-21 policy meeting.

Much might depend on what the August payrolls figures show this Friday, with analysts looking for a moderate rise of 285,000 jobs following July's blockbuster 528,000 gain.

Bond yields surged across Europe after a top ECB official said more tightening is needed even if Europe's economy tips into recession.

European Central Bank (ECB) board member Isabel Schnabel warned over the weekend that forceful action is needed to bring stubbornly high inflation under control.

Governing council member Francois Villeroy and policymaker Martins Kazaks also signaled aggressive policy tightening in September.

The ECB raised rates by 50 basis points to zero last month and a similar or even bigger move is now expected on Sept 8 to preserve the efficiency of monetary policy.