Gold Price Tumbles Amid Rising Yields and Hawkish Fed Expectations

The price of gold has dropped to $4,052.30 an ounce, down 2% from the previous week. This decline is largely due to rising bond yields and shifting Federal Reserve expectations.

The labor market in the US is currently running hot, with initial jobless claims at a record low of 187,000. The Fed's own guidance suggests that they will not raise interest rates until next year, but the market is pricing in an 82% probability of a rate hike in September.

The yield on 10-year US Treasuries has climbed to 4.71%, making gold more expensive and less attractive to investors. China's physical gold buying spree continues, with imports reaching 173 tonnes in June, the highest since March 2024.