Gold Prices Tumble on Strong Dollar and Higher Yields
Gold prices fell on Friday and were poised for a second straight weekly decline due to a stronger US dollar and higher Treasury yields. The precious metal dipped 0.6% to $4,154.78 per ounce by 0205 GMT, with US gold futures losing 0.4% to $4,184.00.
The strong dollar made greenback-priced metals more expensive for holders of other currencies, while yields on 10- and 30-year Treasuries hit their highest levels since 2002 on Thursday. This has weighed heavily on gold prices, as higher borrowing costs typically diminish the attractiveness of gold due to its lack of interest.
Kyle Rodda, senior financial market analyst at Capital.com, noted that 'market participants are watching US interest rate expectations and geopolitical developments in the Middle East.' He added that the upcoming US nonfarm payroll data will be critical for rate expectations, with a strong report potentially increasing the chances of rate hikes from the Federal Reserve.