Gold prices fell on Monday, deepening losses losses for the second day, and hit a 4-week low, weighed down by the recovery in the US bond yields, and ahead of the Federal Reserve monthly meeting.

Gold prices fell 1.3% to the lowest since May 19 at $1,852.79 an ounce, after opening at $1,876.89, and a high at $1,877.89.

Gold lost 1.1% on Friday, and posted its first daily loss in 4 days due to rising US dollar.

Last week, gold lost 0.75%, and posted its second weekly loss, as the strong inflationary data in the US boosted prospected for the Fed to tight the US monetary policy.

The US 10-year treasury yields surged by 1.3%, to extend its rebound for the second day, hurting the market appetite in precious metals. 

Markets await the Federal Reserve monthly meeting, as this meeting would set estimates correctly for policy tightening by the Fed in the next few years.

Gold stocks at the SPDR ETF remained unchanged on Friday, with the total at the highest level since June 1st at 1,044.61 metric tonnes.

Oil prices rose on Monday, extending gains for the third straight day, as the US crude hit a 3-year high, and Brent crude jumped to a 2-year high, thanks to a strong global demand outlook during the second half of 2021 and growing odds for a market supply deficit.

US crude rose 1.25% to the highest since October 2018 at $71.67, from the opening level at $70.79, and hit a low at $70.69, and Brent crude rose 1.3% to the highest since April 2019 at $73.62 a barrel, after opening at $72.70, and hit a low at $72.60.

The US crude gained 1.0% on Friday, and Brent crude rose 0.5%, in the second straight daily gain, thanks to strong demand expectations.

Oil prices rose 1.75% last week, the third straight weekly gain, thanks to growing indicators on the economic recovery in Europe, the US and China.

Thanks to progress in Covid-19 vaccination, most major countries started to ease their lockdown restrictions, especially travel restrictions, which portends increased fuel consumption.

Car traffic has returned to pre-pandemic levels in North America and most of Europe, and more planes are now flying in most of the world.

The International Energy Agency revealed in its monthly report on Friday that OPEC Plus needs to open the taps to keep the world oil markets adequately supplied and to meet the rising demand.

Goldman Sachs projected last week that Brent will rise to $80 per barrel this summer as vaccination campaigns spur the global economy.

USD/JPY tilted higher in Asian trade away from May 27 lows for the fourth session in six, following a spate of data from Japan and amid a lack thereof from the US, as investors wait for the Fed's policy meeting later this week.

As of 06:57 GMT, USD/JPY rose 0.07% to 109.73, with an intraday high at 109.83, and a low at 109.62. 

From Japan, the final reading for industrial production showed a 2.9% growth in April, beating estimates of 2.5% and compared to a 1.7% increase in March. 

The Federal Open Market Committee is convening tomorrow to decide on interest rates and monetary policy, with interest expecting no change to the near zero rates and the bonds purchases program at $120 billion.

Fed Chair Jerome Powell will hold a meeting on Wednesday following  the meeting to explain the decision, with the Fed expected to release three-year estimates for growth, inflation, unemployment, and interest rates. 

US stock indices rose on Friday, lifted by the release of strong inflation data.

The US consumer price index rose by 0.6% in May, the largest monthly increase in 13 years, higher than forecasts of 0.4%. 

The core reading (excluding food and fuel prices) rose by 0.7%, higher than forecasts of 0.5%. 

To the oil market, WTI crude July futures rose 0.9% or 62 cents, and closed at $70.91 a barrel, with a weekly gain of 1.9%, after hitting a high of $71.1 and a low of $69.6.

Brent August futures rose 0.2% or 17 cents, and closed at $72.69 a barrel, with a weekly gain of 1.1%, after hitting a high of $73.09 and a low of $71.8.

As for stocks, Dow Jones rose less than 0.1% or 13 points, and closed at 34,479, and posted a weekly loss of 0.4%, with a day high of 34,618, and a low of 34,328.

Nasdaq rose 0.3% or 49 points to 14,069, and registered a 1.9% weekly gain, with a high of 14,069 and a low of 14,006.

S&P 500 rose 0.2% or 8 points to 4,247, and posted weekly gains of 0.4%, after hitting a high of 4,248 and a low of 4,232.