Gold hovers near 2-week low as dollar strength weighs

GOLD prices edged lower on Monday (Apr 25) near their lowest level in 2 weeks touched in the previous session as an elevated US dollar continued to pressure demand for greenback-priced bullion.

Spot gold was down 0.1 per cent at US$1,928.08 per ounce, as of 12.33 am GMT. US gold futures were down 0.2 per cent at US$1,930.10.

The dollar steadied near its highest in 2 years scaled in the previous session, making gold less attractive for buyers holding other currencies.

Gold prices fell to their lowest since Apr 7 on Friday and marked a weekly decline as signs of faster policy tightening by the US Federal Reserve lifted Treasury yields and the dollar.

US 10-year Treasury yields, however, were off recent highs on Monday, limiting losses in zero-yield gold.

With expectations for a half-percentage point rate hike at the Federal Reserve's May meeting now locked in, traders on Friday piled into bets that the central bank will go even bigger in subsequent months.

Gold is highly sensitive to rising US short-term interest rates and higher yields, which increase the opportunity cost of holding non-yielding bullion. It is also, however, seen as a safe store of value during economic and political crises.

Ukraine will ask US Secretary of State Antony Blinken and Defence Secretary Lloyd Austin for more powerful weapons during an expected visit by the officials to Kyiv on Sunday as the Russian invasion enters its third month.

Battered US stocks are facing a potentially painful stretch in the weeks ahead, as a hawkish Fed, rising bond yields, geopolitical uncertainty and the corporate earnings season fuel investor unease.

Spot silver dipped 0.2 per cent to US$24.10 per ounce, platinum eased 0.2 per cent to US$928.77, and palladium fell 2.3 per cent to US$2,319.78. REUTERS