![Gold falls on dollar strength and treasury yields rise Gold falls on dollar strength and treasury yields rise](https://elcomercio.pe/resizer/qe4BEnnn6fbmGCTOJukDuiB5daw=/980x528/smart/filters:format(jpeg):quality(75)/cloudfront-us-east-1.images.arcpublishing.com/elcomercio/ZXZYXZGULZGIJP3VOBN36D5NDE.jpg)
The gold prices fell on Tuesday due to the strength of the dollar and the increase in Treasury yields, while investors remained on the sidelines awaiting this week’s US inflation data, which would offer more clarity on the path rising interest rates in the country.
Spot gold was down 0.2% at $1,664.13 an ounce at 09:27 GMT, having hit its lowest since Oct. 3. US gold futures fell 0.2% to $1,672.50.
“Hard to make a bullish case for gold”, considering that the peak of inflation may be yet to come and that rate hikes are likely to continue until that scenario, said Craig Erlam, senior market analyst at OANDA.
“It’s just not the ideal environment for gold. We are seeing a rally in the dollar and in yields, and gold has been punished for it”, he added.
Although gold is seen as a hedge against inflation and economic uncertainties, higher rates reduce the attractiveness of bullion, which does not pay interest.
The dollar index hit a nearly two-week high, making gold more expensive for buyers holding other currencies. The 10-year US Treasury bond yield was trading just below 4%.
After stronger-than-expected US jobs data, attention turns to Thursday’s inflation reading, which is expected to remain high and reinforce the Fed’s rhetoric.
Gold has lost nearly 20% since breaking above the $2,000 mark in March. The safe haven has not shone despite the geopolitical uncertainty and the recent drop in stock markets, as most investors have sought refuge in the dollar.
Among other precious metals, silver was down 1.6% at $19.33 an ounce, platinum was down 1.1% at $888.73 and palladium was up 0.7% at $2,187.01.
With information from Reuters
Source: Elcomercio
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I have worked as a journalist for over 10 years and have written for various news outlets. I currently work as an author at 24 News Recorder, mostly covering entertainment news. I have a keen interest in the industry and enjoy writing about the latest news and gossip. I am also a member of the National Association of Journalists.