Gold price increases as U.S. Treasury yields pull back

Boosted by the fall in U.S. Treasury yields, gold rose in early Asian trading on Wednesday. Investors are now waiting for the U.S. and China inflation data to be released later this week.

As of 9:34 pm Eastern Time, gold futures rose 0.32% to US$1,790.45. Yields on 10-year and 30-year U.S. Treasury bonds fell from a one-week high touched on Tuesday.

Investors are now waiting for U.S. data released on Friday, including the consumer price index (CPI). China’s inflation data, including CPI and producer price index, will be announced the day before.

The Reserve Bank of India will announce its policy decisions later in the day. In contrast, the U.S. Federal Reserve, the European Central Bank (ECB), and the Bank of England (BOE) will announce their policy decisions next week.

The governor of the Bank of Estonia, Matisse Muller, said that inflation in the eurozone might exceed the European Central Bank’s forecast for a long time. Hence, when the emergency plan ends in March, there is no reason to push for traditional bond purchase plans.

At the same time, due to the discovery of omicron COVID-19 variants, the Bank of England may postpone becoming the world’s first major central bank to raise interest rates again.

On the Fed side, U.S. President Joe Biden plans to nominate more candidates for vacant positions on the Fed’s board of directors by the end of December 2021.

As for other precious metals, silver rose slightly by 0.2%, platinum rose by 0.3%, and palladium rose by 0.1%. According to data from the consulting firm Metals Focus, the average price of gold, silver, and platinum in 2022 will be almost the same as in 2021, while the average price of palladium will fall.