Gold Prices Ease Amid Firmer Yields, US Data in Focus

Gold prices dipped on December 2, as rising bond yields and stronger-than-expected economic data from the United States weighed on investor sentiment.

Spot gold was down by 0.2%, hovering around $1,959 per ounce, while U.S. gold futures also saw a modest decline. The pullback came after a period of relative stability for gold, which had seen gains earlier in the week.

The market’s attention has shifted toward the latest U.S. economic data, which showed solid job growth and consumer spending. This has fueled expectations that the Federal Reserve could continue its hawkish stance on interest rates, further pushing bond yields higher. The yield on the benchmark 10-year U.S. Treasury note rose to a 16-year high, adding pressure on gold, a non-yielding asset.

Analysts noted that the yellow metal’s appeal has been dented by the possibility of sustained high interest rates, which increase the opportunity cost of holding gold. Furthermore, the data has sparked concerns that the Federal Reserve may have more tightening to do, which could further drag down gold prices.

Despite these challenges, analysts remain cautiously optimistic about gold’s long-term outlook, citing geopolitical tensions and inflation concerns as potential drivers of demand.