Gold Prices Firmed as Softer Dollar Offsets Oil-Driven Yield Pressure
Spot gold prices are higher and spot silver prices are near steady in early U.S. trading Wednesday, as a softer U.S. dollar supports precious metals while elevated Treasury yields and higher crude oil keep the rate-relief trade in check.
The latest positioning remains split between softer U.S. data and stubborn long-end yield pressure. Last week's weaker retail sales, softer CPI, flat headline PPI, and weaker consumer sentiment reduced the market's appetite to price another September Fed hike, while Monday's Empire State survey showed the general business conditions index rising to 20.6 and prices paid climbing to 58.6.
Markets now imply roughly a two-thirds probability that the Fed holds rates steady in September, with hike odds near one-third, while the 10-year Treasury yield is trading near the 4.7% area and the dollar index is softer near 99.36.