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Gold futures lost ground Monday, feeling pressure as the U.S. dollar and Treasury yields kicked off the week with a rise.
Price action
-
Gold for August delivery
GC00,
-0.45% GCQ23,
-0.45%
fell $14.30, or 0.7%, to $1,955.30 an ounce on Comex. -
July silver
SIN23,
-1.06%
was down 19.7 cents, or 0.8%, at $23.55 an ounce. -
July platinum
PLN23,
+1.90%
was up $7.30, or 0.7% at $1,010.80 an ounce, while September palladium
PAU23,
+0.53%
gained $22.50, or 1.6%, to $1,426 an ounce. -
July copper
HGN23,
+0.03%
ticked up 0.1% to $3.732 a pound.
Market drivers
“Gold has started the week on the backfoot, with both the [U.S. dollar] and U.S. Treasury yields being well supported in the wake of Friday’s bumper jobs data,” Tim Waterer, chief market analyst at KCM Trade, said in emailed comments.
Gold ended last week on a down note after a much stronger-than-expected surge in May nonfarm payrolls saw the U.S. economy add 339,000 jobs versus Wall Street forecasts for a figure of around 190,000. That lifted the U.S. dollar and Treasury yields, as well as the overall appetite for stocks and other assets perceived as risky, taking away some of gold’s luster, Waterer noted.
The ICE U.S. Dollar Index
DXY,
a measure of the currency against a basket of six major rivals, rose 0.2%. The yield on the 2-year Treasury note
TMUBMUSD02Y,
rose 3.8 basis points to 4.55%, while the 10-year Treasury note yield
TMUBMUSD10Y,
was up 6.3 basis points at 3.753%.
A stronger dollar can be a negative for commodities priced in the unit, making them more expensive to users of other currencies. Higher Treasury yields raise the opportunity cost of holding assets that don’t pay interest.
