Gold Prices Fall 1.5% as Dollar Firms, Rate-Cut Optimism Fades

Gold fell on Monday as a stronger US dollar weighed on dollar-priced bullion, while higher energy costs fueled inflation concerns and dimmed prospects for near-term interest rate cuts, Noel John reported for Reuters.

US 10-year Treasury yields climbed to a one-month high, raising the opportunity cost of holding non-yielding gold.

Spot gold was down 1.5% at $5,091.02 per ounce as of 0233 GMT, after falling more than 2% earlier in the session. US gold futures for April delivery were down 1.2% at $5,097.40.

The dollar rose to a more-than-three-month high, making bullion more expensive for holders of other currencies.

US 10-year Treasury yields climbed to a one-month high, raising the opportunity cost of holding non-yielding gold.

“Gold is on the back foot today despite the market turmoil, with triple-digit oil prices boosting the dollar on inflation fears and scaled-back rate-cutting expectations,” said Tim Waterer, chief market analyst at KCM Trade.