Gold price ended the trading session for the week on a bearish note.
This was its worst week since March, as U.S. Treasury yields surge and delay of the stimulus package from U.S congress dented the bullion metal’s upside.
Gold futures settled lost 0.85% to trade at $1,953.60.
Gold prices lost about 4.5% in value this week after hitting a record peak of $2,072.50 on August 7.
Higher U.S yields increase the opportunity cost of holding non-yielding assets such as gold, which has gained over 28% so far in 2020.
Stephen Innes, Chief Global Market Strategist at AxiCorp in a note to Nairametrics spoke on the macros affecting the yellow metal’s price. He said;
“And fortunately for gold investors, they have friends at the Fed as speakers unanimously reside incredibly cautious about the US economic recovery.
“It has been a tumultuous week for the gold price, which is back to $1950 levels, having clawed back a good chunk of this week’s losses. The US dollar remains under pressure as investors are growing more skeptical of Congress’s willingness to pass a stimulus package.
Still, it could be a challenge for gold markets to regain last week’s fame as more fixed income traders are willing to short bonds now, which complicates the bullish gold view.”