Gold prices drop as firmer dollar, bond yields dent appeal
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GOLD prices fell on Wednesday (Sep 7), as the US dollar and Treasury yields rose after economic data bolstered expectations the Federal Reserve will continue on an aggressive rate-hike path.
Spot gold was down 0.3 per cent at US$1,696.30 per ounce, as of 1.27 am GMT.
US gold futures were down 0.3 per cent at US$1,708.30.
The dollar index was up 0.2 per cent, inching closer to the 2-decade peak scaled in the previous session, making gold more expensive for overseas buyers.
Benchmark US Treasury yields rose to their highest level since Jun 16 on expectations the Fed will keep hiking interest rates to tame soaring prices. Higher yields raise the opportunity cost of holding non-yielding gold.
The US services industry picked up again in August for the second straight month amid stronger order growth and employment.
Gold imports by India, the world’s second-biggest bullion consumer, halved in August from year-ago levels, as volatile local prices and a weak rupee prompted consumers to postpone purchases, a government source told Reuters on Tuesday.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.21 per cent to 971.05 tonnes on Tuesday from 973.08 tonnes on Friday.
Spot silver fell 0.7 per cent to US$17.92 per ounce, platinum was 0.7 per cent lower at US$847.46 and palladium shed 1 per cent to US$1,986.79. REUTERS
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