Gold futures on Monday posted their first loss in four sessions, with haven demand for the metal taking a hit as U.S. equities partially bounced back from a coronavirus-triggered selloff, and the U.S. dollar and government bond yields rose.
A rise in the U.S. dollar DXY, +0.41%[1], gains in the Dow Jones Industrial Average DJIA, +0.69%[2] and the S&P 500 index SPX, +0.87%[3] as gold futures settled, as well as a climb in rates for the 10-year Treasury note TMUBMUSD10Y, +1.41%[4] yield to as high as $1.574 on Monday helped to weigh on bullion prices, which tend to weaken when the buck strengthens and stocks rally.
Gold also competes with bond rates for haven buyers, with rising yields tending to attract investors in Treasurys and away from precious metals.
“While all eyes are on headlines about the virus, many central banks may be dovish—which lowers other currencies” even as the U.S. seems to be the “most liquid and safest for capital,” said George Gero, managing director at RBC Wealth Management. “All this is temporarily leaving gold buyers to seek other trading opportunities for now.”
Gold for April...