Gold Down, but Pulls Up from Three-Month Low, as U.S. Yields Fall
2022.05.16 08:22
By Gina Lee
Investing.com – Gold was down on Monday morning in Asia, climbing up from a more than three-month low hit in the previous session. Lower U.S. Treasury yields kept demand for gold afloat above the $1,800 mark.
Gold futures inched down 0.07% to $1,807.01 by 1:13 AM ET (5:13 AM GMT).
“With $1,800 being such a big round number, it’s natural for it to provide some level of support as some traders try to be brave and buy a dip, whilst others close out profitable shorts,” City Index senior market analyst Matt Simpson told Reuters.
Marking its fourth consecutive weekly decline, the yellow metal fell more than 1% on Friday to its lowest level since Feb. 4 at $1,798.86, before closing at $1,811.15.
“But it’s not looking great for gold bugs right now. Even if we do see a bounce from $1,800, the momentum clearly favors a further downside,” said Simpson.
The dollar, which normally moves inversely to gold, inched down on Monday but was just off a 20-year high. Concerns about economic growth saw investors turn towards the safe-haven greenback.
Benchmark U.S. 10-year Treasury yields fell, and inflation will need to move lower for “several months” before U.S. Federal Reserve officials can safely conclude it has peaked, Cleveland Fed President Loretta Mester said Friday. Mester added that she would be ready to consider faster rates hike by the September 2022 Fed meeting if the data does not improve by then.
Investors also await the minutes from the Reserve Bank of Australia’s latest meeting, due on Tuesday.
In other precious metals, silver inched down 0.1%, palladium was up 0.3% and platinum was unchanged at $938.46.
