Gold prices fall as Treasury yields rise

Investing.com– Gold prices fell Friday, ending the week lower as Treasury yields rose following the U.S. Federal Reserve’s hawkish tilt 

Spot Gold was 0.7 at $2,614.40 per ounce, while Gold Futures expiring in February edged 0.9% lower to $2,630.36 an ounce.

Trading in gold typically sees thin volumes and subdued prices toward the year-end as many institutional traders and market participants close their books ahead of the holiday season.

Additionally, at year-end, economic data releases and major policy decisions are typically fewer, reducing catalysts for significant price volatility.

The yellow metal was set to edge up 0.3% for the week after losing more than 1% in the previous one. A strong dollar after the Fed’s hawkish shift last week has continued to put downward pressure on bullion. Gold slips amid pressure from rising yields

The US Dollar Index was slightly lower on Friday, pairing overnight gains, though continued to hover near a two-year high it touched last week. Still, Treasury yields were sharply higher, pressuring the yellow metal.  

A weaker dollar often boosts on gold prices as it makes the yellow metal more attractive to buyers using other currencies.

Gold prices had fallen sharply after the Fed policy meeting indicated only two more rate cuts in 2025, against previous expectations of four.

Higher interest rates put downward pressure on gold making it more attractive compared to interest-bearing assets like bonds

Other precious metals were lower on Friday. Platinum Futures were down 3.6% to $919.90 an ounce, while Silver Futures were down 1.5% $29.935 an ounce. Copper gains on concentrate shortage news, strong dollar caps gains

Among industrial metals, copper prices were higher after a Reuters report showed China's leading copper smelters have set lower processing charge guidance for the first quarter of 2025 compared to this quarter, reflecting an ongoing shortage of copper concentrates.

At a meeting in Shanghai, representatives from the China Smelters Purchase Team agreed on new rates for copper concentrate treatment and refining charges, setting them at $25 per metric ton and 2.5 cents per pound, down 28.6% from the fourth-quarter guidance of $35 per ton and 3.5 cents per pound.

The red metal failed to fully capitalize on this news, as a strong dollar weighed.

Benchmark Copper Futures  on the London Metal Exchange rose 0.4% to $8,995.00 a ton, while February Copper Futures  edged down 0.1% to $4.1242 a pound.

Ayushman Ojha contributed to this report. 

Source: Investing.com