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Gold Declines as Treasury Yields Rise

February 20, 2018 at 22:08 by Vladimir Vyun

Gold fell sharply today as the US dollar rallied. The Bloomberg Dollar Spot Index rose almost 0.7% in the Tuesday session. The precious metal usually trades inversely to the US currency. The metal also declined as US Treasury yields surged, making gold, non interest-bearing asset itself, less appealing to investors. Additionally, traders were worried about the upcoming release of the Federal Reserve policy minutes scheduled for 19:00 GMT on Wednesday.

Gold bulls have hopes, though, that stock market volatility and geopolitical tensions may rekindle appeal of the metal as a safe haven. Additionally, attempts of central banks in various developed nations to spur inflation may result in interest in bullion as an inflation-hedge.

Contract for delivery of gold in April slumped 1.81% to $1,331.6 per troy ounce as of 21:59 GMT on COMEX today. May contract for silver declined 1.85% to $16.49 per ounce. Spot price for platinum was down 0.61% to $1,000.39 per ounce. Palladium managed to avoid losses, logging a 0.16% gain and trading at $1,037.00 per ounce.

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