Gold slips as rallying U.S. yields dull appeal

SourceZawya
SectorOil & Gas
CountryMiddle east

Gold prices eased on Thursday as a surge in U.S. Treasury yields and firm dollar dampened demand for bullion, although losses were limited by hopes of more fiscal stimulus after Democrats won control of the U.S. Senate.Spot gold was down 0.4% to $1,911.31 per ounce at 1030 GMT. U.S.

gold futures were up 0.4% to $1,916.60.Prices declined as much as 2.5% after scaling a high since Nov. 9 on Wednesday, as 10-year U.S. Treasury yields jumped above 1% for the first time since March."I see this as a consolidation after a very strong start to the year. The market has caught a bit of a cold because of the (bond yields) rally and they are rallying for the reasons that we're actually seeing gold continue to be supported, so it's a bit of a catch 22 right now," said Saxo Bank analyst Ole Hansen."The U.S. economy is nowhere near any level where we can start to talk about a full recovery and that will require additional stimulus or spending which will potentially drive yields higher, but it will also drive inflation expectations higher."U.S. inflation expectations rose as investors hoped for more fiscal stimulus with the Democrats' victory in Georgia's two ...read more...