(Kitco News) – Despite the recent selling pressure, analysts note that the gold market is holding up remarkably well, given that bond yields have risen to a fresh 15-year high.
Overnight, the yield on U.S. 10-year bonds pushed to 4.36%, its highest level since late 2007. Analysts note that the rise in bond yields is negative for gold as it increases the precious metal’s opportunity costs as a non-yielding asset.
Despite the bond yields, gold prices have managed to hold critical support. December gold futures last traded at $1,926.20 an ounce, up 0.12% on the day.
Some analysts have said that gold could benefit significantly if those rising bond yields indicate a crisis of confidence in U.S. debt. However, many analysts have noted that the weakness in U.S. bonds appears orderly and a natural reaction as the Federal Reserve is expected to maintain its aggressive interest rate hikes.
Nicky Shiels, metals strategist at MKS PAMP, noted that the correlation breakdown between gold and bonds could be the result of low market volatility as interest in physical gold and silver picks up.
www.kitco.com/news/2023-08-22/Gold-prices-holding-critical-support-as-U-S-bond-yields-remain-near-15-year-highs.html
much-anticipated new BRICS gold-backed reserve currency will no longer be announced at the South Africa summit. Instead, a new mechanism for the settlement of payments between BRICS member states will be considered. Proposed under the new acronym “R5”, it considers that all current BRICS currencies start with an “R”: renminbi (yuan), ruble, real, rupee, and rand.
Source:
infobrics.org/post/39152
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