Gold dips on higher bond yields, Fed speakers on tap

Gold prices slipped on Monday, hurt by higher Treasury yields, while investors awaited more US data and comments from Federal Reserve officials throughout the week for more cues on the outlook for monetary policy.

Spot gold was down 0.7% at USD 2,317.08 per ounce as of 02:06 p.m. ET (1806 GMT). US gold futures settled 0.9% lower to USD 2,329.

“There’s really a lack of major fresh fundamental news, so the gold market is looking to the outside markets for direction,” said Jim Wyckoff, senior market analyst at Kitco Metals.

“Gold prices are probably going to grind sideways between USD 2,300 and USD 2,400 until the next major fundamental catalyst occurs, which may not occur until sometime in July.”

The US 10-year Treasury yields ticked higher after falling sharply last week, making non-yielding bullion less attractive for investors.

The Fed would be able to cut its benchmark interest rate once this year, Philadelphia Fed President Patrick Harker said on Monday, if his economic forecast plays out.

Minneapolis Fed President Neel Kashkari said on Sunday it’s a “reasonable prediction” that the US central bank will cut interest rates once this year, waiting until December to do so.

Traders are now keeping a close watch on upcoming comments from New York Fed President John Williams and Fed Governor Lisa Cook.

Lower interest rates decrease the opportunity cost of holding non-yielding bullion.

The release of US retail sales data on Tuesday, weekly jobless claims on Thursday, and flash purchasing managers’ indices on Friday could offer more clarity on consumption and economic strength.

“Back-to-back weaker-than-expected inflation prints, along with the less hawkish details of the FOMC (Federal Open Market Committee) meeting, have seen the appetite for gold increase,” Ryan McKay, senior commodity strategist at TD Securities, said in a note.

“However, with that said, plenty of uncertainty remains regarding the timing of expected cuts, and macro positioning’s beta to data surprises will remain elevated in the near term.”

Spot silver slipped 0.5% to USD 29.38 per ounce, platinum gained 1.3% to USD 970.15 and palladium rose 0.2% to USD 891.92.

(Reporting by Brijesh Patel and Anmol Choubey in Bengaluru; Editing by Paul Simao, Vijay Kishore, and Alan Barona)