Gold futures prices slipped Wednesday as elevated bond yields hovered near their steepest since 2011 and the dollar index traded slightly higher.
December gold GCZ8, -0.10% was down $1.20, or 0.1%, at $1,190.30 an ounce, nearing a revisit of the one-week settlement lows of $1,188.60 hit Monday, before Tuesday’s mild rebound. December silver SIZ8, -0.17% fell 2 cents, or 0.2%, to $14.375 an ounce.
Read: Why gold prices may have already bottomed
The ICE U.S. dollar index DXY, +0.02% was steady-firmer, near 95.68; it remains nearly 4% higher this year so far, contributing to a roughly 9% drop for gold over the same stretch.
The yield on the U.S. 10-year Treasury note TMUBMUSD10Y, +0.68% rose 1.8 basis points to 3.23%.
Because precious metals — usually used as a haven by investors — don’t offer a yield, the commodity is vulnerable to a slump in a rising-rate environment. That climate also tends to lift the dollar, dimming the appeal of U.S.-priced gold to investors using other currencies.
The Federal Reserve has already increased rates three times in 2018 and is expected to lift benchmark rates a fourth time in December, as well as continuing its gradual tightening trend in 2019.
However, stock markets are also vulnerable to rising bond yields and any sign that equity markets are in fast retreat could again resume interest in gold, analysts say.
Should the S&P 500 SPX, -0.14% end lower on Wednesday, marking its fifth straight loss, that would represent its longest streak of losses since November 2016.
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