Gold prices dropped on Thursday, pressured by rising U.S. Treasury yields as investors brace for the release of crucial U.S. Retail Sales data. The increased yields have made non-yielding assets like gold less attractive, pushing the precious metal lower in early trading.
The rise in U.S. yields reflects growing expectations that the Federal Reserve could maintain higher interest rates for an extended period, following solid economic data and a resilient U.S. job market. This has strengthened the U.S. dollar, further weighing on gold, which typically moves inversely to the greenback.
Source – FXStreet
Traders are now shifting focus to the upcoming U.S. Retail Sales report, which is expected to provide fresh insights into consumer spending patterns. A stronger-than-expected reading could reinforce the Fed’s hawkish stance, potentially adding more pressure on gold prices. Conversely, weaker data may offer some respite for the metal, as it could temper expectations of further rate hikes.
For now, gold remains under pressure, with its short-term direction likely hinging on how the market interprets the Retail Sales figures and their implications for future U.S. monetary policy.
