According to CoinMeta, gold prices fell by more than 1% on Thursday as strong U.S. inflation data and rising oil prices increased market bets for a Federal Reserve interest rate hike next week. Kyle Rodda Senior financial market analyst capital.com said that producer price index data indicated that potential inflation in the U.S. economy was on the rise, partly due to increasing energy costs. According to the Federal Reserve Watch tool from the Chicago Mercantile Exchange, traders currently expect a 70% probability of an interest rate hike next week, up from 62% before the data was released. However, most economists surveyed by Reuters expect the Federal Reserve to keep interest rates unchanged at its meeting on September 15-16 and for the rest of this year. The rise in the U.S. dollar made gold, which is denominated in dollars, more expensive for holders of other currencies, and the increase in yields on benchmark 10-year U.S. Treasury bonds further pressured gold prices. Rodda added that higher bond yields reflect more persistent and higher inflation pressures brought about by rising oil prices, which also led to the decline in gold prices. An increase in bond yields usually raises the opportunity cost of holding non-yielding assets, thereby putting pressure on gold.