Gold prices retreat as U.S. dollar strengthens and yields rise

In early Asian trading today, gold prices experienced a downturn, moving from $2,006 to $1,990, amid a stronger US dollar and rising Treasury yields. The , a measure of the currency’s strength against a basket of other major currencies, reached 103.88. Concurrently, Treasury yields saw an increase of 4.40%. This movement in the markets comes as the University of Michigan Consumer Sentiment Index reported a rise to 61.3, setting the tone for market sentiment before the Thanksgiving Day holiday.

The precious metal’s decline also follows recent insights from the Federal Open Market Committee (FOMC) Meeting Minutes released on Tuesday. The minutes revealed a collective preference among policymakers for a careful approach to monetary policy that takes into account current economic conditions and associated risks.

Investors in gold are now looking ahead to the release of S&P Global Purchasing Managers’ Index (PMI) data, which is expected to influence market trends. The Manufacturing PMI is projected at 49.8, while Services PMI is anticipated at 50.3.

Additional economic indicators that may be swaying investor sentiment include a sharp drop in jobless claims to 209,000 and a decrease in continuing claims to 1.84 million. Meanwhile, Durable Goods Orders showed a contraction of 5.4% month-over-month in October, and inflation expectations for the next year edged up slightly to 4.5%, according to the University of Michigan data. These mixed signals reflect an economy grappling with inflationary pressures while showing signs of resilience in the labor market.

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