Treasury yields little changed as volatile week wraps up
Treasury yields were mixed on Friday morning, as investors continued to look for clues on the trajectory of monetary policy.
Gold prices increased on Friday as reduced oil prices and falling Treasury yields eased inflation concerns, following the Federal Reserve's recent interest rate hike. This resurgence has positioned gold for a higher finish to a tumultuous week, despite ongoing expectations of additional Fed rate hikes. At 21:28 ET (01:28 GMT), XAU/USD climbed 0.5% to $4,361.31 an ounce, while Gold Futures remained relatively unchanged at $4,399.87.
XAG/USD rose 1% to $65.88 an ounce, and XPT/USD saw a 1% increase to $1,790.41. The U.S. Dollar Index held steady at 100.22. Gold has largely recouped the previous three-day decline, having risen approximately 2% on Thursday. Following the Fed's unanimous decision to raise interest rates by 25 basis points on Wednesday, Treasury yields fell across various maturities, alleviating some of the pressure on gold, which does not generate interest.
Oil prices experienced a third consecutive day of decline due to improved prospects for supply disruptions in the Middle East. Saudi Arabia anticipates restoring flows through a critical pipeline within days, and some tankers have continued navigating the contentious Strait of Hormuz. The relief in energy pressures has somewhat soothed inflation.
However, Fed Chair Kevin Warsh's remarks on inflation have led markets to anticipate at least one more rate increase this year and potentially up to two more hikes in 2027, presenting a challenging longer-term outlook for bullion. Thursday's rebound lifted gold above its 100-day moving average, a metric frequently utilized to gauge market momentum.
Despite this recovery, gold remains nearly 20% below the levels observed prior to the Iran war's commencement in late February. Investors have continued to bolster their gold exposure, anticipating that its underlying drivers will persist. Gold-backed ETFs tracked by Bloomberg have recorded billions of dollars in inflows, while ANZ reported holdings in these funds have risen for eight consecutive sessions.
ANZ analysts cited robust demand for options on some of the largest gold-backed ETFs, indicating sustained investor interest despite projected tighter monetary policy.
Written by urgent.news from Investing.com's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
