Yields on the 10-year U.S. benchmark paper rose to the highest since April 2019, on bets on big rate hikes by the Federal Reserve to fight inflation.
While gold is seen as a hedge against inflation, rising US interest rates increase the opportunity cost of holding non-yielding bullion.
However, gold’s weakness should be limited due to inflation concerns, said Jim Wycoff, principal analyst at Kitco Metals.
“Any time we have inflationary pressures like we’re seeing now, history shows metals markets have been hunted and I suspect it’s going to continue to be.”
The dollar rose 0.5%, making bullion more expensive for buyers with other currencies.
With Russia-Ukraine peace talks due this week in Turkey, Ukrainian President Volodymyr Zelensky has insisted on his country’s territorial integrity after earlier suggesting he was willing to compromise.
Palladium fell 5.7% to $2,204.61 an ounce, after falling to its lowest level since January 25. The metal has lost nearly 34% since hitting an all-time high on March 7.
“On palladium, despite the closure of airspace between Russia and the US and Europe, alternative routes allow Russia to continue exporting palladium. So I guess some of the supply concerns are fading,” the analyst said. from UBS Giovanni Staunovo.
Platinum fell 1.6% to $986.36, while silver fell 1.9% to $25.03.
Source: Ambito
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