Gold prices were dragged down by a much stronger dollar

Gold slips

The price of gold was slightly down on Tuesday’s opening session after the U.S. dollar held steady due to the surge of Treasury yields on a nine-year peak yesterday. Concerns regarding the enactment of tax reforms in the stateside also influenced the yellow metal.

Looking at gold prices, U.S. gold futures slipped more than 0.2 percent close at $1,276.30 an ounce for its December delivery. Meanwhile, spot gold was also lower by 0.1 percent to settle at $1,276.29 an ounce on its previous close.

Last Monday, U.S. Treasury yields touched a fresh nine-year high after its curve resumed on flattening. The rise of yields can also be tailored to the investors pricing a 25-basis point interest rate hike next month from the U.S. Federal Reserve.

It is already given that higher bond yields are not good for the price of gold because it has the tendency to reduce to demand of the yellow metal, which is non-yielding. A firmer dollar could also put gold under pressure because it makes it expensive for holders outside the United States.

ANZ noted that the price of the bullion is currently trading on a tight range and the lack of progress on tax reforms, along with the sudden jump of U.S. bond yields are showing signs that investors are moving sidelines in the market.

In other precious metals, palladium was close to a two-week low $981.70 but managed to rise by 0.3 percent at $992.72 today. Platinum dropped by 0.4 percent at $928.55 and spot silver declined by 0.5 percent at $16.96.

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