Gold is declining due to rapid growth of U.S. Treasury yields

A three-week low has recently been reached by gold prices due to expectations of further interest rate increases by the Fed. Those expectations affected the U.S. Treasury yields, which has grown and caused intensive sell-off in metal markets.

U.S. Treasury yields are currently again at the high levels that haven’t been seen since the financial crisis of 2008. This is connected to a fact that investors are getting rid of bonds in anticipation of the further growth of interest rates.

Bullion prices are under pressure as the dollar is expected to remain strong, while interest rate hikes has enlarged the opportunity costs of holding gold — this tendency has a great impact on prices over the current year.

At the moment, gold is extremely close to renewing record lows of the year, and such levels might be reached in the nearest future, if the dollar keeps its pressure.