Why Is Gold Trading Gloomy Today?

 The yellow gold metal traded lower on Tuesday, failing to maintain gains earned in the previous session following a decline in U.S. treasury yields.

In the Asian session, spot gold traded slightly lower at $ 1,809 per ounce, after rising higher during the New York session at $ 1,819 per ounce. Gold futures traded at $ 1,812 an ounce.

10-year U.S. bond yields plunged to a six-month low of 1.15%, shortly after the release of U.S. manufacturing data showing a decline for the second month in a row.

Although the 59.5 reading still indicates a strong expansion, the decline recorded has caused investors to worry that a slowdown in the US economic recovery will occur.

The data also dragged the US dollar to lag behind the safe-haven yen and the swiss franc, as well as being squeezed by growing concerns over the spread of the Delta coronavirus variant.

However, gold prices failed to capitalize on this opportunity to rise any longer as the prospects for the Federal Reserve to reduce its bond purchases remain strong.

Most recently, Fed policymaker Christopher Waller said the central bank should cut stimulus by October if the next two monthly jobs reports show jobs rose to 800,000 to 1 million.

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