Daily Times

Gold price remained volatile on Wednesday and touched its lowest level in nearly two weeks during the intra-day trading before coming back into green territory due to a broad US dollar rebound amid a sharp upturn in the US Treasury bond yields.

As of 1240 hours GMT, the gold futures were available at $1,840.80 per ounce, showing an increase of $3.40 (+0.19 percent). Out of the $3.40 per ounce increase, -$2.35 was due to strengthening of the US dollar and +$5.75 was due to predominant buyers, according to Kitco Gold Index. The price of 10 grams of 24-carat yellow metal in Pakistan, meanwhile, dipped to Rs117,000, showing a decrease of Rs1,000 (-0.85 percent). Gold price in the local market remained Rs118,000 on Tuesday last. A decrease in the local gold prices was due to overnight downward change in the global prices when the local market was closed. Moreover, the Pakistani rupee’s appreciation against the US dollar, which appreciated by 0.30 percent during the day, also decreased local prices.

Gold traded at its lowest level in nearly two weeks at around $1,830 during the intra-day trading. The benchmark 10-year US Treasury bond yield stays in positive territory ahead of key US data. The US dollar built on the previous day’s solid rebound from over a one-month low and gained some follow-through traction amid rising US Treasury bond yields.

Speaking at an event in Frankfurt, Federal Reserve Governor Christopher Waller backed a 50 basis point rate hike for several meetings until inflation eases back towards the central bank’s goal. This, in turn, pushed the yield on the benchmark 10-year US government bond to a nearly two-week high, which continued acting as a tailwind for the dollar and contributed to driving flows away from the non-yielding gold. However, the worsening global economic outlook offered some support to the safe-haven gold. Investors remain worried that central banks can hike interest rates to curb inflation without impacting economic growth. Gold, which is often seen as a hedge against inflation, could further benefit from concerns that the global supply chain disruption would push consumer prices even higher.