Gold stabilizes as US bond yields fall and dollar rises

Gold gave up early gains to trade flat on Tuesday as the US dollar rose, lower Treasury yields and growing recession fears kept the yellow metal near its four-week peak.

And gold settled in spot transactions at about 1771.29 dollars an ounce by 0843 GMT, after hitting its highest level since July 5, earlier in the session, at 1780.39 dollars.

In the US futures contracts, there was no change in the price of gold to record 1787.10 dollars an ounce.

US 10-year Treasury yields hit a four-month low, reducing the opportunity cost of holding gold, while the dollar index rose 0.2 percent after hitting a four-week low earlier.

Gold has recently benefited from a batch of weak economic data, as Monday’s survey showed that factories across the United States, Europe and Asia struggled to boost activity last month.

Investors are closely watching macroeconomic indicators since Federal Reserve Chairman Jerome Powell said decisions about future rates will be determined by the new data.

The increase in interest rates by major central banks to combat high inflation usually affects the attractiveness of the yellow metal.

Traders are also watching for a possible escalation in Sino-US tension. US House of Representatives Speaker Nancy Pelosi is scheduled to start a visit to Taiwan on Tuesday, amid objections from China.

As for other precious metals, silver fell 0.5 percent to $ 20.23 an ounce in spot transactions, while platinum fell 0.1 percent to $ 905.54. Palladium also fell 0.8 percent to $2,176.15.