Gold futures touched a 2-month low on Tuesday as hotter-than-expected inflation data out of Europe pushed global bond yields higher, which helped to weigh on prices of precious metals.
Price action
-
Gold futures for April delivery
GC00,
-0.14% GCJ23,
-0.14%
declined by $9.10, or 0.5%, to $1,815 per ounce on Comex after trading as low as $1,810 earlier on Tuesday. That’s the lowest level intraday since Dec. 28, according to FactSet. -
Silver futures for May delivery
SI00,
-0.13% SIK23,
-0.13%
fell by 11 cents, or 0.5%, to $20.68 per ounce. -
Palladium for June delivery
PAM23,
-2.06%
fell by $14.40, or 1%, to $1,413 per ounce, while platinum for April delivery rose by $5.40, or 0.6%, to $947 per ounce. -
Copper for May delivery
HGK23,
+1.33%
gained 4 cents, or 1%, to $4.05 per pound.
Market drivers
Gold slumped as sovereign bond yields around the world climbed early Tuesday as surprisingly hot inflation data out of France and Spain helped cement expectations for a 50 basis point rate hike by the ECB at its March meeting. The data helped weigh on gold on the final trading day of what has been a dismal month for the yellow metal.
Higher bond yields often weigh on the price of gold since they make the yellow metal less appealing by comparison, since it doesn’t offer a yield.
On the bright side, one analyst said the yellow metal’s pullback appears to be approaching a key support level that could offer some support for gold bulls, who have been “flying blind” as the Commodity Futures Trading Commission has suspended reports on trader positioning.
“Gold is edging lower again this morning, moving ever closer to a very interesting area of support between $1,780 and $1,800,” said Craig Erlam, senior market analyst at OANDA, in emailed commentary.
