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Gold slips as Treasury yields rise and the dollar firms
The 10-year US Treasury yield has climbed toward 4.75% and the 30-year above 5.30% since, pressuring XAU/USD, which trades around $4,393, down 0.5% on the day.
Gold prices fell on Tuesday, snapping a two day winning streak as a firmer US Dollar and rising long term US Treasury yields weighed on demand for the non yielding metal, FXStreet reported. XAU/USD was around $4,393, down 0.5% on the day at the time of writing.
The benchmark 10 year Treasury yield climbed toward 4.75% and the 30 year yield rose above 5.30%, its highest level since 2007, in a broader global bond sell off tied to inflation and fiscal concerns. Strategists at Brown Brothers Harriman said higher crude oil has been feeding into yields and worsening fragile fiscal dynamics.
In currency markets, the US Dollar Index was near 99.65 after rebounding from 99.30 on Monday, its weakest level since June 5. Energy driven inflation concerns also stayed in focus amid the US and Iran standoff over the Strait of Hormuz, which has helped keep upside pressure on rates alive.
Looking ahead, traders are expected to focus on the release of the Federal Open Market Committee meeting minutes on Wednesday, along with developments in the Middle East. FXStreet said markets price in about a 65% probability that the Fed will keep rates unchanged next month, with that fading September hike expectation seen supporting gold near term while the dollar and yields limit upside.
Latest closeGold $4,432.00 ▲1.6%|WTI crude $82.40 ▲1.4%|Dollar index 99.64 ▼0.3%