October 6, 2021

Gold Glitter Fades In Asian Session, What's The Reason?

 Gold prices declined in the Asian session, as the greenback continued to show strengthening and higher US bond yields dampened the movement of the precious metal.

Gold initially rose during the New York session, but declined again as the market headed into the opening of the Asian session which saw it trade around $ 1,752 an ounce.

The dollar index traded higher at 94.10 against a basket of major currencies, while 10 -year US treasury yields were strong at 1.56%.

The greenback traded close to a one -year high, reducing gold's attractiveness for holders of other major currencies.

The market has previously been shown with US services PMI data showing better -than -expected readings despite ongoing problems with manpower, logistics and materials resources affecting the continuity of supply.

Meanwhile, Chicago Federal Reserve President Charles Evans reiterated his earlier statement that the U.S. central bank is getting closer to starting a reduction in its monthly bond purchases.

Even so, concerns over high inflation and rising energy prices will weigh on economic growth, to some extent supporting the yellow metal from declining further.