Gold prices steady as easing Treasury yields lift appeal

Gold prices steady as easing Treasury yields lift appeal
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BENGALURU (June 2): Gold held its ground on Thursday (June 2), supported by lower US Treasury yields, after mounting concerns over stubborn inflation worldwide helped prices rebound from their lowest level in two weeks in the previous session.

Spot gold was steady at US$1,847.49 (about RM8,116.02) per ounce as of 0036 GMT. US gold futures were up 0.2% to US$1,851.40.

Benchmark US 10-year Treasury yields dipped, lifting the appeal of zero-yield gold.

Gold prices recovered on Wednesday from their lowest level since May 19 as investors looked towards safe-haven bullion amid broadening inflationary pressures.

Even so, the dollar strengthened amid upbeat US economic data, making bullion less attractive for overseas buyers.

The US Federal Reserve should get interest rates up to a level that no longer stimulates the economy as quickly as possible including 50-basis-point hikes in the central bank's next two meetings, San Francisco Federal Reserve Bank president Mary Daly said on Wednesday.

US job openings fell in April, but remained at significantly high levels, suggesting that wages would continue to rise as companies scramble for workers, and contribute to inflation staying uncomfortably high for a while.

Bullion is considered a hedge against inflation and a safe haven during times of political and economic uncertainty. However, higher short-term US interest rates increase the opportunity cost of holding gold, which bears no interest.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.1% to 1,067.20 tonnes on Wednesday from 1,068.36 tonnes on Tuesday.

Spot silver was flat at US$21.80 per ounce, while platinum fell 0.7% to US$990 and palladium rose 0.4% to US$2,005.50.