Gold falls to six-week low as US yields rise

Yesterday 15:51

By: Dakir Madiha

Gold falls to six-week low as US yields rise

Gold prices declined to their lowest level in six weeks as rising US Treasury yields and a stronger dollar reduced demand for non-yielding assets. The metal traded near 4,540 dollars per ounce after extending a month-long correction that has erased roughly 6 percent of its value.

The downturn reflects shifting expectations around United States monetary policy. Stronger-than-expected inflation data pushed investors to scale back bets on near-term interest rate cuts from the Federal Reserve. Markets have also begun pricing in the possibility that borrowing costs could remain elevated for longer, keeping pressure on precious metals.

Benchmark US government debt yields climbed sharply, with the 10-year note reaching around 4.61 percent and the 30-year yield moving above 5.1 percent. Higher yields increase the opportunity cost of holding gold, which generates no income. The trend has weighed not only on gold but also on silver, which recorded additional losses after a sharp drop in the previous session.

Gold has retreated about 19 percent from its January 2026 peak of 5,608 dollars per ounce. Despite the correction, structural demand factors remain in place. The World Gold Council reported continued central bank accumulation, with net purchases reaching 244 tonnes in the first quarter of 2026, signaling sustained institutional interest even amid price pressure.

Some financial institutions have adjusted their outlooks in response to persistent macroeconomic headwinds. ANZ lowered its year-end gold price forecast, citing elevated yields and inflation uncertainty as key constraints on further upside in the near term.

The correction underscores a broader repricing across global markets as investors reassess the trajectory of US interest rates and inflation dynamics, with higher yields reshaping capital flows away from safe-haven metals.