Gold Hits fresh lows amid fears to fall further

Gold is sliding into fresh lows after being held back by the bears below $1,650 on corrections on Monday. The precious metal dropped to the lowest in more than two years while the US dollar extends its uptrend due to recession-linked fears and rising interest rates.

The US bond yields have also moved up and are reaching their highest in more than a decade. The ICE dollar index has touched 114.53, the highest since 2002 while the yields on the US 10-year note have rallied to their highest since 2008 at around 3.93%.

The surging dollar is a direct product of Fed’s 75 basis point interest rate hike and the promise of further increases as the US central bank looks to combat inflation. This has been a weight for gold since it offers no interest to investors in the search for yield.

Wall Street fell deeper into a bear market at the start of this week with the S&P 500 and Dow closing lower as investors’ worries accelerate about the Fed’s hawkishness.