After a brief reprieve at the end of last week, gold futures are back to trading at two-year lows while the yield on the 10-year Treasury note climbs to its highest level in more than a decade.
Price action
-
Gold futures
GCZ22,
-0.47%
expiring in December were off $11.20, or 0.7%, to $1,672 per ounce. -
December silver
SIZ22,
+0.28%
fell 8 cents, or 0.4%, to $19.31 per ounce. -
December palladium
PAZ22,
+0.20%
advanced $14.80, or 0.7%, to $2,127 per ounce, while platinum for October delivery
PLV22,
+0.87%
advanced $4.80, or 0.5%, to $901 per ounce. -
Copper futures
HGZ22,
-0.85%
for December were off 4 cents, or 1.1%, to $3.478 per pound.
What’s driving markets
Monday looks to be a quiet session with no major economic data releases in the U.S., and no Federal Reserve officials set to speak publicly (since the central bank is still in its ‘blackout period’ ahead of its policy meeting, which begins on Tuesday).
Edward Moya, senior market analyst at OANDA, said gold appears to have run out of downside momentum as the selloff over the past week has returned the yellow metal to its weakest level in two years.
Another catalyst, such as a hawkish Fed on Wednesday, would likely be needed for gold prices to continue to soften.
“The lead up to the FOMC meeting has been very bearish for gold. Gold is stabilizing here as selling pressure has exhausted itself and will likely need to wait for the FOMC decision,” Moya said.
The yield on the 10-year Treasury note
TMUBMUSD10Y,
was up 5.5 basis points at 3.505% in recent trade, around its highest level in more than a decade. Rising yields can weigh on gold and other commodities, raising the opportunity cost of holding nonyielding assets.
