Gold prices rise 1% as the dollar and US bond yields decline
Gold prices rose today, Thursday, supported by a weak dollar and lower US Treasury yields, with investors growing more optimistic about the possibility of an end to the war in the Middle East, which has raised fears of higher inflation.
In contrast, the US dollar fell to its lowest level in 6 weeks, making dollar-denominated bullion less expensive for holders of other currencies. Benchmark 10-year US Treasury bond yields fell 0.1%, leading to a decline in raise bets US interest rates for longer.
Said Kelvin Wong, chief market analyst at "OANDA": "The main driver of the rise in gold prices is optimism about the ceasefire between the US and Iran, which is pushing long-term bond yields globally lower, resulting in a lower opportunity cost of holding gold and silver."
He added: "If we start to see a break above the $4,900 level, further potential rises towards the next intermediate resistance area, which lies at the psychological level of $5,000, cannot be ruled out."
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