NVDA Q3 Earnings Alert: Why our AI share picker is still holding Nvidia sharesRead More

PRECIOUS-Gold fizzles out as yields, dollar gain post U.S. inflation data

Published 13/05/2021, 01:02 am
© Reuters.
XAU/USD
-
XAG/USD
-
DX
-
GC
-
SI
-
PA
-
PL
-
US10YT=X
-
DXY
-

* Palladium XPD= falls as much as 3%

* U.S. consumer price data beat expectations

* U.S. 10-year Treasury yields hit a high since April 13 (Adds comment, updates prices)

By Eileen Soreng

May 12 (Reuters) - Gold fell 1% in choppy trading on Wednesday, en route to snap a five-session-long winning streak, after April's jump in U.S. consumer prices buoyed the dollar and U.S. Treasury yields, reducing appetite for non-yielding bullion.

Spot gold XAU= fell 0.8% to $1,822.91 per ounce by 1:51 p.m. EDT (1751 GMT) after falling up to 1% earlier in the session.

U.S. gold futures GCv1 settled down 0.7% at $1,822.80.

"People trading gold and silver are a little concerned that maybe this inflation is getting a little too quick, and the Fed did say they have tools to tamp it down. ... Traders are concerned about what those tools may be," said Bob Haberkorn, senior market strategist at RJO Futures.

"For this week, you're going to see caution in the gold and silver markets."

Benchmark U.S. 10-year Treasury yields US10YT=RR jumped on the stronger data. US/

While gold is viewed as a hedge against higher inflation that could follow stimulus measures, higher Treasury yields have weighed on gold, which is down over 4% for the year so far.

The dollar index .DXY was up 0.6%, making gold expensive for holders of other currencies.

U.S. Federal Reserve Vice Chair Richard Clarida on Wednesday said it's "not yet" time to pull back on support for the economy, though he also added the central bank would not hesitate to use tools if it sees risk of persistent upward drift in inflation expectations. still going to see the Fed remain stubbornly accommodative here, and that should provide some underlying support (to gold)," Edward Moya, senior market analyst at OANDA, said.

"What you're going to see is that the market is going to slowly transition to viewing gold as an inflation hedge."

Elsewhere, palladium XPD= fell as much as 3% and was last down 2.4% at $2,867.06 per ounce, while platinum XPT= dipped 1.3% to $1,218.83.

Silver XAG= fell 1.6% to $27.17 per ounce.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.