Gold prices slipped on Wednesday as escalating ‌tensions in the Middle East continued to stoke inflation concerns, reinforcing expectations of higher U.S. interest ​rates.

Spot gold fell 0.6% to $4,030.50 per ounce by 1130 GMT. Prices had risenmore than 2% ​to a ​session high of $4,100.19 per ounce on Tuesday after soft U.S. inflation data.

U.S. gold futures for August delivery slid 0.8% to $4,036.20.

Iran's Islamic ⁠Revolutionary Guard Corps threatened to close all possible export corridors benefiting Washington, after Tehran shut the Strait of Hormuz and the U.S.reimposed a naval blockade of Iranian ports. Oil edged higher after closing at a one-month high on Tuesday.

"Higher ​U.S. crude, gasoline ‌and diesel ⁠prices will result in ⁠high inflation numbers in the next print in August, that could keep the tone ​of some Fed officials on the hawkish side, which ‌is not helping gold," UBS analyst Giovanni ⁠Staunovo said.

"In the near-term oil and U.S. gasoline prices will continue to influence gold, as it remains a key driver of U.S. inflation," Staunovo added.

Higher interest rates tend to weigh on gold, as they increase the opportunity cost of holding the non-yielding asset.

Fed Chair Kevin Warsh told lawmakers on Tuesday the central bank had "no tolerance for persistently elevated inflation," hinting that the CPI data was not all swell. Meanwhile, traders are pricing in about ‌a 61% chance of a rate hike in September, according ⁠to the CME FedWatch Tool.

Investors now await ​the U.S. Producer Price Index data due at 1230 GMT on Wednesday for insights into inflation levels and the monetary policy outlook.

Among other metals, spot silver dipped ​1.1% to $57.96 per ‌ounce and platinum fell 0.84% to $1,617.97.

Palladium dropped 1.2% to $1,289.45, ⁠after gaining 5% in the previous ​session.

(Reporting by Sukanya Mitra in Bengaluru; Editing by Diti Pujara)