In a series of consecutive declines, gold futures concluded their eighth consecutive day in the red on Wednesday (Aug. 16), marking the lengthiest period of consecutive closings in over six years. The persistent downtrend is attributed to the upward trajectory of U.S. Treasury yields, which have exerted sustained pressure on the precious metal.
The latest trading session saw gold futures drop by $6.90, accounting for a 0.36% decrease, ultimately settling at $1,928.30 per ounce. This figure represents the lowest closing level recorded since July 6. Concurrently, silver futures experienced a dip of 12.10 cents, translating to a 0.53% reduction, with prices reaching $22.535 per ounce. Platinum futures also joined the downward trend, sliding by 90 cents or 0.10%, to rest at $891.30 an ounce. Meanwhile, palladium futures were not spared, enduring a decline of $26.20 or 2.1%, to hit $1,212.40 per ounce.
The pivotal factor influencing this trend is the surge in the 10-year U.S. Treasury yield, which surged to 4.241% overnight. This abrupt climb in yields elevates the opportunity cost associated with holding onto gold. Unlike assets that generate interest, gold lacks this income stream, making it comparatively less appealing when yields are on the rise.
Investor attention is now trained on the forthcoming release of the minutes from the Federal Open Market Committee (FOMC) meeting, which convened on July 25-26. The New York gold market remained dormant as the FOMC deliberations took place, with the minutes set to shed light on the committee’s viewpoints and potential future actions.
Shortly after the market’s closing bell, the FOMC disclosed the minutes from its most recent meeting. The minutes revealed that certain members of the committee had expressed reservations regarding the potential risks associated with aggressive interest rate hikes, fearing that such a course of action could jeopardize the stability of the U.S. economy. Conversely, the majority of the committee’s members are focusing their efforts on containing inflation. The minutes noted that while inflation exhibited signs of deceleration, it still remains above the Federal Reserve’s targeted 2% threshold.
Interestingly, following the release of the meeting’s minutes, the dollar index witnessed a 0.22% surge, measuring the greenback’s strength against a basket of six major currencies. Simultaneously, U.S. Treasury yields experienced a further ascent, amplifying the already impactful dynamics in the market. As investors continue to assess these evolving factors, the landscape for both precious metals and bond yields remains intriguingly poised for future developments.
The Spot Market is Open
Thursday, August 17, 2023
| Metals Updated at | USD Bid/Ask | Ounce Change | Low/High |
| Gold 13.00 | 1,891.80 1,892.70 | +0.30 +0.02% | 1,888.60 1,894.60 |
| Silver 13.00 | 22.51 22.61 | +0.14 +0.60% | 22.35 22.63 |
| Platinum 13.00 | 887.00 897.00 | +3.00 +0.34% | 882.00 898.00 |
| Palladium 13.00 | 1,186.00 1,246.00 | +7.00 +0.59% | 1,176.00 1,247.00 |
| Rhodium 05.00 | 3,350.00 4,550.00 | 0.00 0.00% | 3,350.00 4,550.00 |