Gold inches down as higher yields outweigh stimulus optimism

By Administrator_ India

Capital Sands

Gold prices edged lower on Thursday as firmer Treasury yields eclipsed support from a Democrat sweep in Georgia Senate runoffs that boosted hopes for more stimulus.

Spot gold eased 0.1% to $1,916.77 per ounce by 0250 GMT, after declining more than 1.5% in the previous session. U.S. gold futures climbed 0.5% to $1,918.40.

Increasing the opportunity cost of holding non-interest bearing gold, the 10-year U.S. Treasury yield remained firm after rising above 1% for the first time since March on Wednesday.

However, bullion’s decline was limited as Democrat victories in two Georgia races cleared the way for a larger fiscal stimulus under President-elect Joe Biden.

Many investors view bullion as a hedge against inflation and currency debasement that they fear could result from large stimulus measures.

Concerns briefly rose when supporters of outgoing President Donald Trump stormed the U.S. Capitol in a bid to overturn his election defeat.

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