Spot gold and silver prices hold gains, testing resistance in quiet holiday trading gold silver
- Spot gold and silver prices are holding on to modest gain in a quiet trading session Tuesday as U.S. markets are closed for Independence Day.
"Gold traders feel the pain of gradually mounting U.S. yields, but buyers are still willing to enter the market below the $1900 in hope that we are nearing a top in the U.S. yields' upside trajectory," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank, in her daily research note. Some analysts have said higher-for-longer interest rate projections could eventually weigh on gold. In a recent interview with Kitco News, Daniel Pavilonis, senior commodities broker with RJO Futures, said that gold prices might need to fall below $1,900 an ounce to attract new attention.
Although bond yields have increased, some analysts note that the market continues to flash significant recession warnings. Ole Hansen, head of commodity strategy at Saxo Bank, noted that U.S. 2–10-year yield curve spread has hit a 20-year high,"further strengthening the view the U.S. economy is heading in the wrong direction, potentially curbing the FOMC's ability and willingness to hike rates to lower inflation further.
"It is hard to be structurally bullish on the economy when almost the entire Treasury curve is inverted, despite the fact that yields across the board, short and long-term, have been increasing," he said."Today's issue in the Treasury curve resembles prior stagflationary times with yields across all durations continuing to move higher."
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