Gold dives to 7-month low on rising US bonds yield

Gold prices rose on Friday, to deepen losses for the seventh straight day, and hit a 7-month low while on track for the largest weekly loss in 2021, due to rising US bonds yield.

Gold prices fell 0.9% to the lowest since July 2020 at $1,760.68 an ounce, after opening at $1,776.51, and hit a day high at $1,777.55.

The yellow metal closed lower by 0.1% yesterday, in its sixth straight daily loss and the longest losing streak in 2021, in the longest losing streak since November 2011.

Gold prices lost around 3.5% so far this week, to head for the biggest weekly loss in 2021, as the yield of the 10-year US Treasury bonds rose.

The 10-year US Treasury bonds yield rose 1.0% to 1.311%, extending its gains for the second day near the 12-month high of 1.331%.

This jump in the US bond yields comes after the US inflation expectations rose to the highest level in six years, especially after energy prices rallied, in addition to massive stimulus measures, which indicates that the global economy has entered a more solid phase on the road to recovery from the Covid-19 pandemic after the launch of many vaccination campaigns in most parts of the world.

Gold stocks at the SPDR ETF remained unchanged yesterday, with the total at the lowest level since June 10 of 1,132.89 metric tonnes.