Gold Dips on Strong Dollar and Higher Treasury Yields
Gold prices dipped on Tuesday, facing pressure from a stronger US dollar and rising Treasury yields. Spot gold fell 0.3% to $4,127.87 per ounce by 0620 GMT, while US gold futures held steady at $4,155.30. The dollar's strength made gold more expensive for investors using other currencies, contributing to the decline.
Despite the losses, gold's downside was limited by easing expectations of a Federal Reserve interest rate hike in October. This shift came after data showed US job growth slowed more than expected in September, with revisions lowering previous months' nonfarm payrolls. However, traders still see an 87% chance of a rate increase in December, according to CME's FedWatch Tool.
Analysts remain bullish on gold's long-term prospects, citing geopolitical risks in the Middle East as a potential catalyst. Kyle Rodda, senior financial market analyst at Capital.com, noted that a change in US rate expectations or new price data could also drive gold's next move.
Other precious metals also declined, with spot silver, platinum, and palladium each losing 0.7%. Meanwhile, US services sector activity slowed in September, and supply chain pressures pushed input prices to their highest level in over four years, hinting at persistent inflation.