Photographer: Andrey Rudakov / Bloomberg
Photographer: Andrey Rudakov / Bloomberg
Gold has fallen as the dollar remains resilient and ten-year treasury yields are kept at the highest level in more than a year, with the weight on the precious metal offering no interest.
Investors will focus on a heavy bond auctions focused on maturities that have strengthened amid a brightening outlook for growth and inflation. Federal Reserve Chairman Jerome Powell repeated in a Wall Street Journal main article that the central bank will continue to provide assistance to the economy “as long as it lasts”, as the recovery is far from complete. Thomas Barkin, president of Richmond Fed, said in a TV interview with Bloomberg on Sunday that there is still no sign of unwanted inflationary pressures.
Bullion has fallen by about 8% this year, with investors switching from shelters to riskier assets, although its role as a hedge against inflation has helped support prices. On Friday, the Fed said it would cut significant capital for major banks expires at the end of the month. As a result, dollar and bond yields rose higher, with the latter holding its highest level in about 14 months on Monday.
“The opportunity to be in a reflective environment seems to be holding back gold,” said Chris Weston, head of research at Pepperstone Group Ltd. “The appeal of gold as a portfolio hedge is not there either, with the US dollar an apparently better play. ”
Spot gold fell 0.3% to $ 1,740.79 an ounce in Singapore at 11:49 a.m., after rising 0.5% on Friday. Silver, platinum and palladium all withdrew. The Bloomberg Dollar Spot Index advanced a third day.
Meanwhile, Treasury Secretary Powell and Treasury Secretary Janet Yellen are expected to make their first joint appearance before the U.S. Financial Services Committee to testify about the Fed’s and the Treasury’s pandemic policy.