Gold Prices Weaken Amid High Yields and Strong Dollar

Gold's recent rebound after the PCE data has been limited by high Treasury yields and a strong US dollar, making it less likely that the Federal Reserve will lower interest rates. The spending and growth figures in the latest economic reports give the Fed more reason to maintain its current monetary policy stance. Meanwhile, mixed labor market data have put a spotlight on the upcoming jobs report.

The ratio analysis for gold suggests that despite the short-term weakness, it remains in a long-term bull market. In fact, a correction in Treasury yields and US dollar would likely support the recovery in gold prices.