Gold, Silver Prices Tumble as PCE Inflation Report Takes Center Stage

The prices of Gold and Silver have been affected by recent comments from New York Fed President John Williams. He indicated that the Federal Reserve will likely only raise interest rates by 0.25% on one more occasion in 2022. This news pushed down the prices of these precious metals earlier, but now they are facing another challenge.

The bond market is experiencing rising yields due to increasing inflation and government debt issuance, as well as strong economic data. The 10-Year Treasury yield has risen to levels not seen since 2007. As a result, the opportunity cost of holding non-yielding investments such as Gold and Silver has increased.

Geopolitical factors are also affecting Gold and Silver prices, but they are supporting rather than controlling them. The US is considering easing sanctions on Iran in exchange for changes to their nuclear policy, which could lead to an increase in global oil supply.