U.S. Rates and the Dollar Increase on Solid Data, while Gold Drops Following data that indicated the Federal Reserve may pause the pace of rate cuts this year, higher U.S. Treasury yields and a stronger dollar caused gold prices to slightly decline on Wednesday. The price of spot gold dropped 0.1% to $2,648.69 an ounce. …
U.S. Rates and the Dollar Increase on Solid Data, while Gold Drops
Following data that indicated the Federal Reserve may pause the pace of rate cuts this year, higher U.S. Treasury yields and a stronger dollar caused gold prices to slightly decline on Wednesday.
The price of spot gold dropped 0.1% to $2,648.69 an ounce. At $2,662.20, U.S. gold futures dropped 0.1%.
Following statistics on Tuesday that indicated a robust economy, the dollar appreciated and the benchmark 10-year Treasury yield reached an eight-month high.
In November, there were 8.098 million job opportunities in the United States, more than anticipated and more than the 7.839 million in October.
According to the CME FedWatch tool, markets are now pricing in the likelihood of only one Fed cut in 2025, as opposed to two in December.
With most officials worried that inflation would flare up again, the Fed’s December projections suggested a change to a more conservative pace of rate decreases this year.
Although high rates lessen the appeal of the non-yielding asset, bullion is nonetheless seen as an inflation hedge.
China, the world’s largest consumer, increased its gold holdings in December for a second consecutive month, according to figures released on Tuesday by the People’s Bank of China.
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