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Gold and Silver Slide as Dollar and Yields Rise
Gold and silver prices fell on Wednesday.
Gold dropped to its lowest level since August 5, while silver fell below $60.
The US dollar became stronger, making gold more expensive for people using other currencies.
US government bond yields also rose, which can make gold less attractive because gold does not pay interest.
Investors were waiting for notes from a Federal Reserve meeting to learn more about interest-rate plans.
Some officials said rates might need to rise to control inflation.
Even so, the article says some long-term gold investors remain optimistic.
A survey of conference delegates forecast gold could reach $5,013 per ounce in the next 12 months.
Spot gold fell 1.6% to about $4,096.13 per ounce, its lowest level since August 5.
Silver dropped more than 2.6% and traded below $60.
The US dollar index rose 0.7%, while the 10-year Treasury yield reached 5.32%.
Investors awaited the Federal Reserve's September meeting minutes amid debate over inflation and possible rate increases.
Despite year-to-date losses, conference delegates forecast gold at $5,013 per ounce within 12 months, and China's central bank continued buying.
- Who
- Gold and silver markets; investors were also watching the Federal Reserve.
- What
- Gold and silver prices fell sharply amid a stronger US dollar, rising Treasury yields, and concerns about inflation and interest rates.
- Where
- In global markets, with prices also reported for India's MCX market.
- When
- Wednesday; the Federal Reserve's September meeting minutes were due that day.
- Why
- A stronger dollar makes dollar-priced gold costlier for buyers using other currencies, while higher yields and interest rates can reduce the appeal of non-yielding gold.
Near-term pressure
Long-term optimism
Precious metals outlook
Near-term pressure
A stronger US dollar, rising Treasury yields, and expectations of tighter monetary policy are weighing on gold and silver.
Long-term optimism
The article describes long-term sentiment toward gold as bullish, citing forecasts of $5,013 per ounce within 12 months and continued Chinese central-bank purchases.
Key facts
- Spot gold
- Down 1.6% to about $4,096.13 per ounce, its lowest level since August 5.
- Silver
- Down more than 2.6% and trading below $60.
- Indian market prices
- Gold at Rs 1,46,961 per 10 grams; silver around Rs 2,20,500 per kilogram.
- US 10-year Treasury yield
- Rose to 5.32%, a level last seen in 2002.
- US dollar index
- Climbed 0.7%.
- Brent oil
- Rose 1.35% over the previous session to above $101.
- Year-to-date performance
- Gold is down 5%; silver has lost 20%.
- Gold buying by China
- China's central bank raised gold purchases in September, extending its buying run to 23 months, according to World Gold Council data.
Sources
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