Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinSpot gold edged up less than 0.1% as concerns about an expansion in Middle East turmoil lifted safe-haven inflows despite sharp increases in yields and the dollar.

A Maersk container vessel was attacked by Iran-backed Houthi rebels in the Red Sea and an Iranian warship entered the region, marking an escalation in tensions linked to the Gaza war. US helicopters sank three Houthi boats and killed 10 militants on Sunday in defense of the Danish ship.

Meanwhile, Benchmark 10-year Treasury yields jumped above 4% in intraday trading before slipping back to hold above 3.9%, creating a headwind for gold by increasing the opportunity cost for holding it instead of bonds.

The unexpected rise in yields was seen as a response to a sharp increase in the Secured Overnight Funding Rate, an important Wall Street rate for overnight repo loans tapped by hedge funds, money market funds, and banks. The little-known rate soared to 5.4% late last week, the highest since its inception in 2018, as institutional demand for funding outstripped the ability of dealers to provide it.

The dollar tracked higher with yields, adding 0.8% against major rivals. A stronger dollar weighs on gold and other commodities by making them more expensive in other currencies, limiting overseas demand.

The other precious metals were lower, with silver sliding 0.5% while platinum and palladium dropped 1% and 2.3%, respectively.

At the New York close: spot gold gained $2 to $2064.40; spot silver slipped 12 cents to $23.73; spot platinum lost $9.50 to $985.50; and spot palladium fell $25.40 to $1,083.90 an ounce.