Gold futures edged higher on Wednesday, attempting to recover some lost ground from the prior session, with modest gains perhaps supported by slippage in yields for U.S. government debt even as the dollar strengthened.
Gold for August delivery was up 3.30, or 0.2, at 1,908.30 an ounce, following a 0.02 slip on Tuesday on Comex. Prices for the yellow metal scored a gain of nearly 8 in May.
The moves in bullion comes as the benchmark 10year U.S. Treasury yield was at 1.60, off 1.5 basis points. Lower bond yields can reduce the opportunity costs of owning precious metals which dont offer a coupon.
However, moves in gold were checked by a rise in the dollar, as gauged by the ICE U.S. Dollar Index which was up 0.3. A stronger dollar can make assets priced in the monetary unit more expensive to overseas buyers.
July silver meanwhile, was down 5 cents, or 0.2, at around 28.06 an ounce, after rising 0.3 on Tuesday.
Precious metals have trended higher against the backdrop of rising inflation fears, with bullion seen traditionally as an inflation hedge.
Market participants have vacillated between greater confidence that the economy will show a healthy recovery from the COVID pandemic and fears that the economy may run too hot for the Federal Reserve to manage.
Against that backdrop, strategists predict that gold may remain rangebound until Fridays report on the U.S. employment situation in May, which could serve as a crossasset catalyst, especially after Aprils report showed…