Gold Price Analysis: XAU/USD under pressure as real yields rocket higher
It’s been another ugly day for spot gold (XAU/USD) prices, which have been under pressure for pretty much the entire session in tandem with US bond markets, which have also been selling off for pretty much the entire session. That bond market sell-off, which has been all that market participants have been talking about, has seen US 5 and 7-year bond yields surge nearly 20bps, the 10-year yield surge nearly 15bps (to above 1.50%) and the 30-year yield rally just over 5bps.
Gold Price Analysis: US yields sky-rocket, the bears go back to the drawing board
Gold prices have dropped to a fresh low of $1,765 and have traded over 2% lower on the day so far. The US yields have sky-rocketed, raising the prospects of the Federal Reserve needing to step into the bond market with yield curve control, (YCC).
The markets are reacting to a catastrophic tailing in the 7-year auction with the 7Y pricing at 1.195% equating to a 4.1bps tail to the 1.151% when issued.
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