As the US dollar and yields increase, gold hits a five-month low

17 Aug 2023 , 09:59 AM

On Thursday, gold prices fell to their lowest level in five months as the U.S. dollar and Treasury yields rose as recent positive economic data fuelled hopes that the Federal Reserve would continue tightening monetary policy.

Spot gold declined to its lowest price since March 15 at $1,891.70 per ounce. To $1,921.80, U.S. gold futures saw a 0.3% decline.

According to the minutes of the July Fed meeting, ‘most’ officials still gave the fight against inflation top priority, but ‘some participants’ warned against raising interest rates too high.

Reference The dollar rose to its highest level since mid-June as a result of 10-month high 10-year U.S. Treasury yields, which also attracted investors away from non-interest-bearing gold. 

In another indicator that the economy is continuing to defy grim predictions of a recession, single-family homebuilding in the United States increased in July.

 In order to improve growth and reach its economic goal for this year, China will better coordinate its numerous programs, according to a cabinet meeting cited by official media on Wednesday.

Concerns that China’s worsening real estate sector problem is choking what little economic momentum there is have increased in light of a leading Chinese trust firm’s missed payments on investment products and a decline in home values.

The sizeable industrial sector of the euro zone recovered in June, providing a slight boost to overall GDP and helping to end a quarter that had otherwise been poor.

Despite a significant decline in the headline inflation rate, concerns about persistently high inflation in Britain increased as the Bank of England’s key price rise indicators remained unchanged in July.

Spot silver increased by 0.2% to $22.42 per ounce, while platinum held constant at $882.50 after falling as low as it had been since October. To $1,205.70, palladium decreased 0.3%.

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