Gold prices jump on weak US dollar, yields
- 19 Apr 2021
Gulf Today Report
Gold prices gained on Monday, gearing for a seven-week rise as the dollar and US Treasury yields decline.
Spot gold was up 0.1% at $1,777.65 per ounce by 04:50 GMT while US gold futures edged 0.1% lower to $1,777.80 per ounce.
According to Michael McCarthy, chief market strategist at CMC Markets, the drop in dollars and interest rates is supportive of gold.
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"We've got the momentum. But of course, we are at a very important point having just got through that $1,765 level,” he added.
The decline in the dollar makes it weak against its rivals, thereby, making gold more affordable for other currency holders.
On the other hand, lower bond yields reduce the opportunity cost of holding non-interest bearing gold.
US Federal Reserve has reiterated its stance to keep monetary policy accommodative until the crisis is over, while Fed officials have said that any spike in inflation is likely to be temporary.