Gold hits near 2-week low as US bond yields, dollar firm

GOLD prices hit a near 2-week low on Wednesday (Jun 1), as rising Treasury yields and a strengthening US dollar continued to sap demand for greenback-priced bullion.

Spot gold was down 0.2 per cent at US$1,834.09 per ounce, as of 12.44 am GMT, its lowest since May 20. US gold futures fell 0.6 per cent to US$1,838.20.

The dollar index steadied after gaining on Tuesday, making bullion more expensive for buyers holding other currencies.

Benchmark US 10-year Treasury yields rose, lowering the appeal of zero-yield gold.

Gold prices fell about 1 per cent in the previous session, and recorded a second consecutive month of declines in May.

US President Joe Biden on Tuesday met with Federal Reserve Chair Jerome Powell to discuss historic inflation that's draining American wallets, even as he assured the central bank chief he would have freedom from political interference.

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Gold slips as yields, dollar climb; faces 2nd monthly drop

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Bullion is considered a hedge against inflation, but the Fed hiking short-term US interest rates to fight rising costs raises the opportunity cost of holding it, as gold itself yields no interest.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.1 per cent to 1,068.36 tonnes on Tuesday from 1,069.81 tonnes on Friday.

Spot silver dipped 0.1 per cent to US$21.2 per ounce, and platinum fell 0.1 per cent to US$963.48, while palladium firmed 0.1 per cent to US$2,000.79. REUTERS