Gold and Silver Prices: Gold slips under pressure from higher yields; silver nears $67.30..
Gold and Silver Prices: Gold prices saw a slight decline in international markets during early Asian trading on Monday (September 21). This drop was driven by a rise in US Treasury yields. Meanwhile, silver maintained its gains, trading near $67.30 per ounce.
At the time of writing, gold was trading at $4,416 per ounce on COMEX during early trading—down by $8.90 or 0.20%. Prices fluctuated between a high of $4,422.10 and a low of $4,396.40 per ounce.
Meanwhile, COMEX silver stood at $67.270 per ounce, marking a gain of $0.121 or 0.18%. It traded within the range of $66.550 to $67.555 per ounce.
This movement in gold prices is attributed to US Treasury yields remaining at elevated levels. The benchmark two-year Treasury yield has risen sharply in recent sessions as markets reassess the trajectory of US monetary policy following recent Federal Reserve guidance. Higher yields can exert pressure on gold, as the metal does not generate interest income.
Additionally, the dollar remained strong against major currencies, further pressuring bullion (gold and silver). Investors are now monitoring new economic data—including manufacturing and service PMI readings, US housing data, durable goods orders, and consumer sentiment—for clues regarding interest rates and demand for precious metals.
Reasons for the Pressure
US Yields and Fed Stance: Rising bond yields remain a significant headwind for gold. Markets are assessing how long US interest rates might remain elevated, a factor that could impact demand for non-interest-bearing assets. Dollar Movements: A strong US dollar can make dollar-denominated commodities (such as gold and silver) more expensive for buyers using other currencies, potentially dampening demand.
Geopolitical Risks: Events in West Asia remain a significant factor for bullion. Any escalation in tensions could boost demand for these metals as 'safe-haven' assets, although fluctuations in yields and the dollar might temper this impact.
Gold and Silver Outlook
Gold prices saw gains last week. On COMEX, December gold futures closed at $4,424.90 per ounce, while silver prices rose by approximately 3% to close at $67.15 per ounce.
On the MCX, October gold futures rose by ₹1,597 (1.04%) last week to ₹1.54 lakh per 10 grams, while silver futures climbed nearly 3%, reaching ₹2.41 lakh per kilogram.
Analysts believe that gold prices will continue to see volatility and remain range-bound as the market keeps a close watch on the dollar, bond yields, geopolitical developments, and crude oil prices. The primary focus will be on whether higher yields and a strong dollar continue to cap gains in gold and silver prices, or if geopolitical risks and investment demand provide support.
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