Gold Recovering After Touching Two-Month Low
Gold prices are recovering on Thursday after touching the lowest level seen in two months during the previous session, in the wake of US
Gold prices are recovering on Thursday after touching the lowest level seen in two months during the previous session, in the wake of US Treasury yields easing lower; however, gains remain limited as the US dollar remains strong. At the time of writing, GOLD is trading at a little above $1,783.
After touching a one-year high, the benchmark 10-year US Treasury yields eased lower, helping gold recover some of its sheen in the markets. Higher bond yields increase the opportunity cost oh holding bullion, sending its prices lower as they strengthen.
Gold prices are also supported by recent developments towards rolling out the next round of fiscal stimulus measures in the US. On Wednesday, President Biden met with top union leaders to garner support for his proposal for an additional $1.9 trillion worth of stimulus to boost the US economy’s recovery.
However, the yellow metal is under pressure over a renewed bullishness in the US dollar amid release of positive economic data. As we know, gold shares a negative correlation with the dollar – a stronger greenback makes the safe haven metal more expensive to purchase for holders of other currencies.
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