Gold and silver prices drop sharply as oil surges and bond yields rise on Fed rate hike fears.

Gold and silver prices fell significantly on Tuesday due to rising crude oil prices and a global bond selloff that pushed U.S. Treasury yields higher. This reinforced market expectations that the Federal Reserve may raise interest rates again this month. Spot gold dropped 2.68% to around $4,327.70 an ounce, while silver fell 3.71% to about $63.95 an ounce. The surge in oil prices was driven by geopolitical tensions shutting down the Strait of Hormuz, which increased inflation concerns and bond yields, negatively impacting precious metals. Investors are now focused on upcoming U.S. labor reports later this week, which could influence the Fed's rate decision and the direction of gold and silver prices.