Gold drops on firm Treasury yields, dollar - GulfToday

Gold drops on firm Treasury yields, dollar

Gold

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Gulf Today Report 

Gold prices declined on Monday as US Treasury yields and dollar firmed following beyond expectation US economic data that lifted prospects for higher inflation.

Spot gold fell 0.4% to $1,735.90 per ounce by 05:35 GMT while US gold futures were down 0.4% to $1,737.10 per ounce.

Margaret Yang, DailyFX strategist said, "stronger-than-expected data suggests that inflation (will be) picking up faster-than-expected in months to come, which is leading to a rise in real yields, exerting pressure on gold."


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Gold serves as a shield against inflation but higher Treasury yields reduce the appeal of the non-yielding metal.

In a note, Jeffrey Halley, OANDA senior market analyst said, "for now, gold looks set to trade quietly in a $1,730 to $1,760 range, with Bitcoin seemingly the safe-haven asset of choice at the moment."

"In the meantime, gold remains at the mercy of the US 10-year Treasury yield."

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