Gold Resists Treasury Yield Surge as Dollar Weakness Provides Cushion

Gold prices hovered around $4,400 an ounce on Thursday as a softer US dollar offset pressure from elevated Treasury yields. The spot price of bullion was little changed in Asian trading after gaining in the previous session.

The 10-year Treasury yield traded around 4.84%, near its highest level since 2023, but the dollar's weakness cushioned the impact on gold prices. According to Filip Andersson, a strategist at Danske Bank, expectations for a Bank of Japan rate increase combined with the possibility that the Fed stays on hold have helped push the dollar lower against the yen.

This currency weakness has made dollar-priced bullion cheaper for buyers using other currencies, providing an important offset for gold. However, Peter Grant, a strategist at Zaner Metals, warned that a hotter inflation reading could quickly change the balance by strengthening the dollar and encouraging a more hawkish Fed.