It has been another disappointing day for the S&P/ASX All Ords Gold (Index: ^AXJO) (ASX: XJO).
In afternoon trade the gold index is down 2% to 4,376 points. This is its lowest level since early August and brings its month-to-date decline to over 7%.
Why are the gold miners sinking lower today?
The shares of gold miners including Saracen Mineral Holdings Limited (ASX: SAR), Northern Star Resources Ltd (ASX: NST), and Independence Group NL (ASX: IGO) have sunk lower today after the gold price continued its decline.
At the time of writing the spot gold price is down to US$1,280 an ounce, its lowest price in over a month.
The price of the precious metal has been losing ground recently after tensions in North Korea eased and the U.S. Federal Reserve hinted at a rate rise before the end of the year and three more in 2018.
As rates rise in the United States, risk-free bond yields widen, reducing the appeal of gold with traders.
If rates do rise as quickly as the Fed has hinted, there's a reasonable chance that the gold price could fall towards the US$1,000 level once again.
