Swap traders have now shifted their expectations for the Fed’s next rate cut to the second half of the year, and 30-year Treasury yield rose above 5% for the first time for the first time in more than a year.
While higher rates typically are a headwind for bullion as it pays no interest, gold traders continue to pile into the precious metal as they focused on other factors such as risks from potential tariffs by President-elect Donald Trump, stubborn inflation and rising US debt load.
Gold and silver’s resilience is “impressive considering the stronger dollar and rising bond yields,” said Ole Hansen, head of commodities strategy at Saxo Bank. It highlights that the metals are “driven by other factors including trade wars, inflation worries, and fiscal debt worries.”
See also: Gold climbs to record as expanding trade war aids haven demand
Spot gold slipped as much as 0.1% after the data release. The price was 0.1% higher at US$2,670.84 ($3,662.94) an ounce as of 8.39am in New York. As of 9.36am in New York, spot gold rose 0.9% to US$2,691.05 an ounce. Silver, platinum and palladium advanced.
