Gold Prices Struggle to Hold Gains Amid Rising Dollar and Yields

Gold prices struggled to hold gains above $4,300 an ounce as the U.S. dollar and bond yields rose, but BMO Capital Markets sees underlying demand strengthening.

The precious metal dropped below $4,300 and is trading at $4,279.80 per ounce, down nearly 2% on the day.

Despite this decline, commodity analysts at BMO pointed out that investment demand has remained relatively robust as investors continue to hedge against debasement-related themes and concerns surrounding U.S. fiscal sustainability.

Physical demand is also providing fresh support for gold, with India's local market discount narrowing amid resilient wedding-related demand, while Chinese imports, ETF buying, and futures activity all point to healthy underlying investment demand.