London — Gold hit a one-week low on Tuesday after US Treasury yields touched fresh highs as investors priced in a rate hike in December, but the precious metal’s losses were limited by rising uncertainty over the US growth outlook. Yields on two-year US treasuries hit nine-year highs on Monday, supporting the dollar and reducing the appeal of nonyielding bullion. However, rising nearby yields flattened the US treasury yield curve, in part reflecting market wagers that rising rates in 2017 and 2018 will eventually slow the economy. These fears, coupled with uncertainty over the outlook for US tax reforms, kept gold’s losses in check, hitting investor risk appetite and increasing gold’s appeal as a safe-haven asset. "These levels in gold are quite well supported because real US rates are going to remain very depressed and potentially negative going into next year as inflation starts to ramp up in the US," said Martin Arnold, strategist at ETF Securities. Spot gold was down 0.4% at $1,...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.