Gold prices fell on Wednesday, due to the appreciation of the dollar and US Treasury bond yields, after the minutes of the US Federal Reserve’s June monetary policy meeting confirmed expectations that interest rates would remain high for a longer period.
The US Federal Reserve agreed to keep interest rates unchanged during its June meeting, according to the meeting minutes released on Wednesday, even as the majority of the Fed predicted that further monetary tightening would eventually be needed.
price movements
Spot gold prices fell 0.5 percent to $1916.49 an ounce by 18:32 GMT, while US gold futures fell 0.1 percent to $1927.10 upon settlement.
The benchmark US Treasury bond yields for ten years approached their peak in four months after the minutes of the meeting were released, while the dollar rose 0.3 percent against its competitors.
High interest rates lead to a decline in investment in gold, which does not yield a return, but is considered a safe hedge at a time of economic uncertainty.
Investors now expect 86 percent of the Fed to raise interest rates by 25 basis points, with rate cuts expected from 2024, according to CME Group’s Videowatch tool.
As for other precious metals, spot silver rose 0.8 percent to $23 an ounce, while platinum fell 0.1 percent to $914.11, and palladium jumped 1 percent to $1,255.78.
2023-07-05 20:08:29
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