Gold prices dip on firm US bond yields, dollar

GOLD prices edged down on Monday (May 9) as elevated US Treasury yields and a firm dollar pressured demand for greenback-priced bullion.

Spot gold fell 0.1 per cent to US$1,880.56 per ounce, as of 12.49 am GMT, while US gold futures were down 0.2 per cent to US$1,879.30.

Benchmark 10-year US Treasury yields hit their highest since November 2018, pressuring prices of zero-yield gold.

The dollar hovered close to a 20-year high against its rivals, making greenback-priced bullion less attractive for other currency holders.

US job growth increased more than expected in April as manufacturers boosted hiring, underscoring the economy's strong fundamentals despite a decline in output in the first quarter.

Two of the Federal Reserve's most outspoken policy hawks on Friday pushed back on the view that the US central bank missed the boat on the fight against high inflation, citing a tightening of financial conditions that began well before the Fed began raising interest rates in March.

While gold is seen as a safe store of value during times of political and economic crises, it is highly sensitive to rising short-term US interest rates and bond yields, which raise the opportunity cost of holding bullion.

As many as 60 people are feared to have been killed when a bomb struck a village school in eastern Ukraine, the regional governor said on Sunday, while Russian forces continued shelling the last holdout of Ukrainian resistance in the ruined southeastern port of Mariupol.

Asian markets got off to a shaky start on Monday as US stock futures took an early skid on rate worries, while a tightening lockdown in Shanghai stoked concerns about global economic growth and possible recession.

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Gold faces third weekly decline as dollar, Treasury yields firm

Spot silver slipped 0.4 per cent to US$22.24 per ounce, platinum fell 1.2 per cent to US$951.69, and palladium dropped 0.2 per cent to US$2,042.80. REUTERS