Gold prices fell Wednesday as the yield on US Treasuries rose and an impending rise in the US interest rate negatively impacted demand for the precious metal.
Spot gold prices fell 0.1% to $ 865.31 an ounce, while US gold futures fell 0.2% to $ 1,866.10 an ounce.
And the yield on 10-year US Treasuries rose today, Wednesday, after falling in the previous session, in view of the decision by the Federal Reserve (the US Central Bank) to raise the interest rate by 50 basis points to curb rising inflation.
Although gold is considered a hedge against inflation, rising short-term interest rates and rising Treasury yields increase the opportunity cost of holding non-interest bearing gold.
As for other precious metals, silver fell 0.1% in spot transactions to $ 22.54 an ounce.
Platinum was up 0.1% to $ 962.60 an ounce, while Palladium fell 0.1% to $ 2,252.51 an ounce.
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