According to ING strategists Warren Patterson and Ewa Manthey, gold has continued to drop, currently trading close to $4,500 per ounce as non-yielding assets are impacted by rising US Treasury yields and a stronger US dollar (USD). They observe that speculative net length is at its lowest point since February 2024 and ETF holdings have decreased, with the market prioritizing yields over geopolitical concerns.
Gold is impacted by higher rates and the USD.
"With spot prices lingering near $4,500/oz yesterday, as US Treasury yields climbed higher amid the rebound in oil prices, gold continued its slide for a second straight session."
"Increased energy costs indicate that inflation worries are just intensifying, indicating that rates will continue to be higher than initially projected."
Gold and other non-yielding assets have been impacted by this. In the meantime, the USD's overall strength will only increase pressure.
"Since the beginning of hostilities in the Persian Gulf, ETF holdings in gold have decreased by more than 2.2%, while the managed money net long in COMEX gold is at its lowest level since February 2024."
"For the time being, the gold market seems to be more concerned with rising Treasury yields than with the persistent geopolitical danger."
Gold is impacted by higher rates and the USD.
"With spot prices lingering near $4,500/oz yesterday, as US Treasury yields climbed higher amid the rebound in oil prices, gold continued its slide for a second straight session."
"Increased energy costs indicate that inflation worries are just intensifying, indicating that rates will continue to be higher than initially projected."
Gold and other non-yielding assets have been impacted by this. In the meantime, the USD's overall strength will only increase pressure.
"Since the beginning of hostilities in the Persian Gulf, ETF holdings in gold have decreased by more than 2.2%, while the managed money net long in COMEX gold is at its lowest level since February 2024."
"For the time being, the gold market seems to be more concerned with rising Treasury yields than with the persistent geopolitical danger."
