The biggest factor influencing gold is the anticipation of the Fed meeting, while Thursday’s US Q2 GDP figures may also be a major driver, said Daniel Pavilonis, senior market strategist at RJO Futures. .
Two-year Treasury bond yield rose 3.8 basis points to 3.029%while that of the 10-year note it gained 6.1 basis points to 2.842%.
The market is expecting the Federal Reserve to opt for a further 75 basis point hike rather than a larger move to quell stubbornly high inflation as the probability of a recession over the next year rises to 40%, according to a survey of Reuters among economists.
Last month’s 75 basis point rise was the first of that magnitude since 1994. Although gold is seen as a hedge against inflation, rising interest rates reduce the appeal of this non-yielding asset.
The price of gold has fallen more than $350, since breaking above the $2,000 per ounce level in early March, due to the Fed’s rapid rate hikes and the recent rally in the dollar.
In other precious metals, platinum was up 0.4% at $877.34, while palladium was down 0.9% at $2,012.64. (By Arundhati Sarkar in Bengaluru; Edited in Spanish by Juana Casas and Javier Leira)
Source: Ambito
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