Investing.com – Gold prices fell on Tuesday amid rising bond yields as investors continued to bet that strong economic growth and an improved inflationary environment could encourage the Federal Reserve to adopt a faster path to monetary tightening.
for February delivery on the Comex division of the New York Mercantile Exchange fell by $3.30, or 0.25%, to $1,336.10 a troy ounce.
With just a day remaining until the Federal Reserve reveals its decision on monetary policy and insights into the pace of US economic growth and inflation, rising US bond yields continued to pressure gold prices, as the precious metal remained on track to post its first two-day loss in three weeks.
Gold is sensitive to rising U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
Upbeat consumer confidence, meanwhile, added to the narrative of an improving economy after rebounding from a decline in December.
The rose to 125.4 in January from 122.1 in December, beating economists’ forecast for a reading of 123.1.
President Donald Trump’s address due later was also said to have curbed demand for gold as market participants remained wary of any potential comments on dollar, after Trump pledged support for stronger dollar last week.
Gold is sensitive to moves higher in the U.S. dollar – a stronger dollar makes gold more expensive for holders of foreign currency, thus, reduces investor demand for the precious metal.
In other precious metal trade, fell 0.36% to $17.08 a troy ounce, while fell 1.32% to $999.30.
fell 0.19% to $3.19, while rose 1.96% to $3.23
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