PRECIOUS-Gold slides more than 1% to 3-week low as U.S. yields climb

  • Reuters
  • Commodities News
PRECIOUS-Gold slides more than 1% to 3-week low as U.S. yields climb
Credit: © Reuters.

(Updates prices)

* U.S. Treasury yields hit 14-month high

* Dollar index jumps to four-month peak

* Palladium inches up after Monday's 5.5% decline

* Crucial support for gold at $1,670/oz -analyst

By Asha Sistla

March 30 (Reuters) - Gold prices slid more than 1% on Tuesday as the U.S. dollar rose on the back of higher Treasury yields and as expectations that speedy vaccinations would improve the economic outlook curbed demand for safe-haven bullion.

Spot gold XAU= slipped 1.4% to $1,687.76 per ounce by 1153 GMT. Earlier in the session, bullion fell by as much as 1.5% to its lowest since March 9 at $1,685.80. U.S. gold futures GCv1 fell 1.5% to $1,688.70 per ounce.

"Gold is under pressure as investors are expecting a strong economic rebound in the U.S. because of the pace of vaccinations there and the stimulus driving investor sentiment and bond yields in the U.S. to new highs again for the year," Fawad Razaqzada, market analyst with ThinkMarkets, said.

The dollar index .DXY jumped to a more than four-month high as benchmark U.S. Treasury yields rose to a 14-month peak on expectations of stronger growth and inflation ahead of U.S. President Joe Biden's multi-trillion-dollar infrastructure spending plan. US/ USD/

Gold is seen as a hedge against rising inflation, but firmer Treasury yields, which translate into a higher opportunity cost for holding bullion, have challenged that status.

Investors have been piling more money into riskier equity markets than gold, Razaqzada added.

Global stock markets rose as investors focused on the global COVID-19 vaccination programme. MKTS/GLOB

"From a technical point of view, the (gold) price is playing with the key level of $1,700. A crucial support is placed at $1,670, a recent low, while the overall scenario for gold remains moderately bearish," ActivTrades chief analyst Carlo Alberto De Casa said in a note.

Elsewhere, silver XAG= fell 1.7% to $24.24 an ounce and platinum XPT= was down 0.8% at $1,166.19.

Palladium XPD= gained 0.4% to $2,537.98, having slid 5.5% in the previous session.

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or

100

Related Articles