Gold Fell $43.7 Due to the Strong Dollar and Rising U.S. Treasury Note Yields

Gold futures fell to a 3-week low on Monday (June 13) as the dollar and rising U.S. Treasury yields pressured markets. The Federal Reserve (Fed) may accelerate its rate hike at its meeting this week to curb inflation after the U.S. consumer price index (CPI) rose more than expected.

  • Gold futures fell $43.7, or 2.33%, at $1,831.8 per ounce. This is the lowest closing level since May 18, 2022.
  • Silver was down 67.6 cents, or 3.08%, at $21.255 an ounce.
  • The platinum contract was down $38.7, or 3.99%, at $932.3 an ounce.
  • The palladium contract fell $128.60, or 6.7%, at $1,778.40 an ounce.

The dollar index against the six major currencies in a basket of currencies rose 0.89% to 105.0730, while the yield on the 10-year U.S. Treasury rose to 3.25%.

A stronger dollar will make gold contracts more expensive for holders of other currencies. A rise in bond yields will increase the opportunity cost of owning gold. This is because gold is an asset that does not yield a return in the form of interest.

The market was also pressured by fears that the Fed would raise interest rates to curb inflation. U.S. CPI numbers released last week showed an 8.6% increase in May, reaching the highest level in more than 40 years.

The CME Group’s FedWatch tool indicates that more than 50% of investors now expect the Fed to raise rates by 0.75% at its June 14-15 meeting, up from just 5% previously.

The Spot Market is Open

Tuesday, June 14, 2022

Metals
Updated at
USD
Bid/Ask
Ounce
Change

Low/High
Gold
12.30
1,825.40
1,826.40
+6.70
+0.37%
1,808.80
1,829.30
Silver
12.30
21.17
21.27
+0.14
+0.69%
21.00
21.32
Platinum
12.30
941.00
951.00
+11.00
+1.18%
928.00
954.00
Palladium
11.30
1,745.00
1,895.00
+17.00
+0.98%
1,718.00
1,902.00
Rhodium
05.00
12,500.00
14,500.00
0.00
0.00%
12,500.00
14,500.00

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