Gold stays flat, treasury yield curve flattens

FXStreet (Mumbai) – Gold prices stay almost unchanged around USD 1095/Oz levels after the US data, but the treasury yield curve has flattened indicating the increased prospect of a rate hike.

Rate hike bets on the rise

The metal keeps the range of USD 1083-1087/Oz levels after the US GDP and jobless claims hit the wires. However, the treasury yield curve flattened – 2-year yield relatively strong as compared to the 10-year yield. The short-end yields are more sensitive to rate hike expectations. The 2-year yield rose almost 4 basis points while the 10-year yield rose 1.5 basis points.

The yield curve usually flattens when the rate hike expectations are on the rise. The FOMC policy statement released on Wednesday titled slightly to the hawkish side.

Gold Technical Levels

The immediate support is seen at 1073.10 (July 24 low), under which the prices could extend the drop to 1050.00. On the other hand, resistance is seen at the daily high of 1088.30 and 1098.40 (hourly 200-MA).

Gold prices stay almost unchanged around USD 1095/Oz levels after the US data, but the treasury yield curve has flattened indicating the increased prospect of a rate hike.

(Market News Provided by FXstreet)