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Gold breaks below key support as yields and USD rise
A stronger-than-expected U.S. PPI pushed the 10-year Treasury yield up 7.4 basis points to 4.911% and the U.S. dollar index up 0.31%, reinforcing pressure on gold.
Gold is falling sharply after breaking below an important cluster of technical support near $4,356, with traders shifting from viewing the level as a floor to treating it as resistance, according to Forexlive.
The move comes as a slightly stronger-than-expected U.S. PPI print lifted Treasury yields and the U.S. dollar. The outlet cited headline PPI at 5.4% versus 5.3% expected, while core remained at 4.6%, above 4.3% the prior month, keeping the focus on the possibility that the Federal Reserve may need to maintain restrictive policy for longer.
Forexlive said the U.S. Dollar Index was up 0.31%, while the 10-year Treasury yield rose 7.4 basis points to 4.911%, its highest level since late October 2023. The article noted gold has moved down to around $4,324.16 during volatile trading.
The next downside target identified by the outlet is the 50% midpoint of the prior move up from the late-June low, at $4,319.75. It also explained the two main channels behind weakness when yields and the dollar rise, gold not paying interest and the dollar strengthening making gold more expensive for non-U.S. buyers.
Latest closeGold $4,157.80 ▲0.4%|Dollar index 102.12 ▼0.1%