Metals Stocks: Gold futures settle at a 2-week low, pressured by rising dollar, Treasury yields

Price action

• December gold futures
  GCZ22,
  -0.58%

  GC00,
  -0.58%
  were down $13, or 0.7%, to settle Wednesday at $1,776.70 per ounce on Comex. Prices for the most-active contract settled at their lowest since Aug. 3, FactSet data show.

• September silver
  SIU22,
  -1.52%
  retreated by 35 cents, or 1.8%, to $19.731 an ounce.

• September palladium futures
  PAU22,
  -0.42%
  settled down by $12.30, or 0.6%, to $2,136.70 an ounce, while October platinum
  PLV22,
  -1.02%
  lost $12, or 1.3%, to $919.30 per ounce.

• September copper
  HGU22,
  -0.95%
  declined by 4 cents, or 1.1%, to $3.5835 per pound.

What analysts are saying

Jim Wyckoff, a senior analyst at Kitco, attributed the pullback in gold and silver this week to two primary factors: weak economic data out of China, and a rebound in the U.S. dollar and Treasury yields.

Gold and silver prices are lower again in U.S. trading Wednesday amid “worries about demand for precious metals following this week’s downbeat economic data coming out of China and still-heightened worries about a U.S. and/or global recession,” Wyckoff said.

The ICE U.S. Dollar Index
DXY,
+0.11%,
a gauge of the dollar’s strength against a basket of rival currencies, was up 0.2%, while the 10-year Treasury yield
TY00,
-0.55%
was up 8.5 basis points to 2.908%.

Having made considerable gains since dropping below $1,700 an ounce in late July, “gold is finding considerable resistance to climb back above the important psychological threshold of $1,800 an ounce,” said Rupert Rowling, market analyst at Kinesis Money, in a market update.

The prospect of future rate hikes by the Fed being less aggressive and shorter-lasting than previously anticipated has been “tempered by the reality that more hikes will nonetheless be needed, which diminishes the appeal of a non-yield bearing asset such as gold,” he said.

Gold prices edged higher from Wednesday’s settlement to $1,780.20 in electronic trading shortly after the release of minutes of the Federal Open Market Committee’s July meeting.

Read: Federal Reserve officials back moving rates higher in order to slow the economy

The minutes, released about a half hour after gold futures settled for the session, showed that many Fed officials were worried about the risk that the central bank could tighten the stance of monetary policy by more than was necessary.