Inflation Surge Dents Gold and Silver Prices as US Dollar Strengthens

Gold and silver prices slid on Wednesday as the US Dollar surged following stronger-than-expected inflation data. The Consumer Price Index (CPI) rose to 6.4% per year, exceeding analyst forecasts.

The Federal Reserve's target for core PCE measure, currently at 2.0%, jumped 0.3 percentage points to 3.7%. This sent interest rates rebounding in the bond and futures markets, with US Treasury bond yields rising from three-week lows.

The price of silver dropped below last week's level, dipping to $68 per troy ounce, while gold fell as low as $4,600 before recovering $20. The gold price currently trades 1.6% beneath its Tuesday high.

UBS investment team notes that 'gold is a clear beneficiary of de-dollarization,' with investors considering bullion a reliable store of value and an alternative to traditional reserve currencies.