Gold trades lower as dollar, treasury yields strengthen

Gold stumbled at the close of the week’s trading as a stronger dollar index and rising treasury yields pressured investor’s appetite for the precious metal. Spot gold was down 0.8 per cent to $1,815.19 per ounce, while U.S. gold futures shed 0.9 per cent to $1,813.30. Commenting on gold’s modity strategist at TD Securities, said gold’s reaction to the dollar surge suggested that it remains vulnerable to a further pullback. “Although gold’s valuation is more attractive on a relative basis to U.S. Treasury inflation protected securities (TIPS), the reason gold is trading at a discount to it is because it does not have the same carry advantage,” he added. improving physical bullion demand, particularly from top-consumer China, and central bank purchases could limit the precious metal’s declines. Phillip Streible, chief market strategist at Blue Line Futures in Chicago, noted that gold is likely to rebound as uncertainty around a potential spike in COVID-19 Delta variant cases in the United States could force the Fed. to relonger, a positive step for the yellow metal. For other precious metals, palladium lost 3.6 per cent to $2,633.20 an ounce to record its first weekly decline in a month, platinum declined 2.9 per cent to $1,105.92, while Silver was down 2.3 per cent to $25.73 per ounce.