The move higher may have been exacerbated by algorithmic traders selling Treasuries after the 10-year yields broke above their daily 200-day moving average.
The yields are in the middle of their recent range after falling from a one-month high of 1.379% on Aug. 12, while holding above a six-month low of 1.127% reached earlier this month.
Chinese blue chips shed 3.2% in the biggest daily decline since March, as the education and property sectors were battered due to concerns over tighter government rules.
Spot gold rose 0.3pc to $1,781.77 per ounce by 12:48 pm EDT (1648 GMT), after jumping to $1,794.86, its highest level since June 18. U.S. gold futures gained 0.4pc to $1,782.90.