Gold Closes $48 Lower – Dollar Strength and Rising Treasury Yields Weigh on Markets

Gold futures closed lower on Monday (May 2), with markets pressured by rising U.S. Treasury yields and a stronger dollar. The U.S. Federal Reserve (Fed) is likely to raise interest rates by 0.5% at its meeting on May 3-4.

  • The gold futures fell $48.1, or 2.52%, at $1,863.6 an ounce.
  • Silver was down 50.1 cents, or 2.17%, at $22.584 an ounce.
  • The platinum contract was down $6.8, or 0.72%, at $932.8 per ounce.
  • The palladium contract was down $91.00, or 3.94%, at $2,216.00 an ounce.

The yield on 10-year U.S. Treasury yields briefly exceeded 3% before falling back to 2.99%. A rise in bond yields increases the opportunity cost of owning gold. Gold is an asset that does not yield interest.

The dollar index rose 0.76% against the six major currencies of a basket of currencies to 103.7430. A stronger dollar made gold contracts more expensive for holders of other currencies.

Gold futures also came under pressure from fears that the Fed may accelerate rate hikes. Fed Chairman Jerome Powell said the Fed needs to act faster to fight inflation and there is a possibility the Fed will raise rates by 0.50% at its May meeting. This would be the first time the Fed has raised rates by 0.50% since 2000.

The Spot Market is Open

Tuesday, May 3, 2022

Metals
Updated at
USD
Bid/Ask
Ounce
Change

Low/High
Gold
12.00
1,861.00
1,862.00
-2.40
-0.13%
1,859.50
1,868.40
Silver
12.00
22.62
22.72
+0.04
+0.15%
22.53
22.83
Platinum
12.00
939.00
949.00
+5.00
+0.54%
934.00
953.00
Palladium
12.00
2,170.00
2,320.00
+25.00
+1.17%
2,130.00
2,326.00
Rhodium
05.00
16,800.00
18,800.00
0.00
0.00%
16,800.00
18,800.00

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