Gold has fallen roughly 25% from its January peak despite a Gulf war, an oil shock and inflation above 3%, as rising Treasury yields increase the opportunity cost of holding the non-yielding metal. The 10-year Treasury yield reached 5.22%, its highest level since June 2007, while traders placed the odds of a second consecutive Federal Reserve rate hike at 70.3%. Spot gold dropped 3.06% to $4,153.10 an ounce on Monday, its lowest close since early August, and SPDR Gold Shares (NYSE:GLD) closed Friday at $393.41, 22.8% below its January record of $509.70. The market chain runs from higher oil prices to increased inflation pressure, further Federal Reserve tightening and higher Treasury yields. Real yields are central to the move: the 10-year Treasury Inflation-Protected Securities (TIPS) yield reached 2.87%, meaning investors could earn almost 2.9% annually above inflation from 10-year Treasuries. August PCE inflation data and September payrolls are due later in the week, with stronger readings potentially increasing rate-hike pricing and adding pressure to gold.