Investing.com – Gold fell to its lowest level since December on Wednesday, as the U.S. dollar surged and bond yields rose.
Comex for June delivery were down 0.15% to $1,288.40 a troy ounce as of 10:37 AM ET (14:37 GMT).
The price of bouillon was driven lower by the rise in the greenback. The , which measures the greenback’s strength against a basket of six major currencies, rose 0.15% to 93.28.
Gold is denominated in the U.S. currency and becomes more expensive for holders of other currencies when the dollar rises.
Meanwhile the precious metal was held back by rising bond yields. The yield on the benchmark Treasury note was at 3.085 after reaching a seven-year high of 3.095 on Tuesday.
Strong upbeat data this week has also made it more likely that the Federal Reserve will increase interest rates. U.S. rose in April, while increased at a slower rate than forecast. Expectations of higher interest rates tend to boost the dollar by making the currency more attractive to yield-seeking investors.
Higher rates are a negative for gold as the precious metal, which does not pay interest, struggles to compete with yield-bearing assets when rates rise.
Elsewhere on the Comex, were up 0.22% to $16.305 a troy ounce. Among other precious metals, platinum fell 0.52% to $892.50 while palladium slipped 0.09% to $982.30 an ounce. futures increased 0.10% to $3.059 a pound.
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Source: Investing.com
