The gold price is under the pump again going into Friday's trading session with the US Dollar continuing to be underpinned by rising Treasury yields.
The DXY (USD) index traded at its highest level since early June overnight while spot gold traded at its lowest level since March after touching US$ 1885 oz.
Gold is sometimes seen as somewhat of a ‘haven’ in such circumstances but that has not been the case in this latest episode of markets schism. Treasuries are also seen as a risk-free asset and are sometimes sought after in times of upheaval.
Both of these assets have been moving lower in price and it might be the dynamic coming out of China that could be driving the price action.
With Treasury yields climbing, which sees the capital value slide lower, it could see investors avoid the non-yield bearing yellow metal.
If the situation in China continues to unravel, authorities there might need more USD to sell to support the Yuan. This could see more interest for the Dollar in other markets, including XAU/USD. To learn more about how to trade gold, click on the banner below.
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