Gold fell on Thursday to its lowest level in more than six months as oil prices rose following new US strikes on Iran, raising concerns about inflation and the prospect of higher interest rates for longer.

By 00:43 GMT, spot gold prices had decreased by 0.2% to $4,063.87 an ounce after hitting their lowest since November 21 earlier in the day.

US gold futures for August delivery fell 1.1% to $4,086.50.

The US military said on Wednesday that the United States began a new round of strikes against multiple targets in Iran overnight, after President Donald Trump pledged further attacks if a peace agreement was not reached.

Counterfeit gold coins and US dollar bills (Reuters)

Oil prices rose by more than two dollars on Thursday after Iran announced the closure of the Strait of Hormuz following US strikes.

The rise in crude oil prices can accelerate inflation, and while gold is seen as a hedge against inflation, rising interest rates tend to negatively impact the non-yielding metal.

Data showed that the US consumer price index rose in May at its fastest pace in three years, driven by higher energy prices amid the conflict in the Middle East, giving the Federal Reserve more reasons to keep interest rates unchanged until 2027.

Markets are awaiting the US producer price index data for May, due later today, to assess the monetary policy stance.

For other precious metals, silver in spot transactions fell 0.9% to $63.15 an ounce, platinum lost 0.6% to reach $1,655.06, while palladium rose 1% to $1,225.25.