Gold Prices Plunge
Gold Prices Hit Seven-Week Low Amid Rising Treasury Yields and Federal Reserve Rate Hike Expectations
Anonymous
Gold prices have come under pressure as stronger economic data, persistent inflation concerns and rising U.S. Treasury yields have reinforced expectations for tighter Federal Reserve policy, making the non-yielding metal less attractive. Reports say the Fed recently raised rates and signaled further increases may follow, while a robust jobs report and stronger dollar also weighed on bullion. Better-than-expected U.S. new-home sales added to the pressure in one session. Oil-price moves have offered mixed signals: elevated energy costs have stoked inflation fears, while easing supply concerns and hopes for a U.S.-Iran deal have at times supported gold. Despite the near-term declines, analysts cited in the reports say gold may need a fresh catalyst to regain momentum.
Key Points
1
Gold’s monthly loss reached 8%, and it fell to a seven-week low in one report; another said bullion was down about 19% from its February 27 high.
2
The 30-year U.S. Treasury yield climbed to just under 5.5%, its highest level in more than two decades. OCBC analyst Christopher Wong said, “If yields keep pushing higher, I wouldn’t be surprised to see gold stay under pressure.”
3
Despite the price decline, physical gold buying in India showed modest improvement as lower prices attracted consumers ahead of the festival season.
4
In one report, traders had largely ruled out any Federal Reserve rate cuts that year, reversing earlier expectations for two cuts.
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