Gold slips to 1.5-month low as Treasury yields, dollar rise

Higher Treasury yields and a firmer dollar pulled money away from gold by making income-bearing assets look safer and more rewarding, even as Middle East tensions kept a geopolitical bid under bullion. Spot gold fell 0.2% to $4,472.09 an ounce at 0615 GMT, after touching its weakest level since March 30, while June U.S. gold futures slipped 0.8% to about $4,475.

The drop came after a sharp move in U.S. borrowing costs. The 30-year Treasury yield briefly hit 5.197%, its highest since July 2007, and the 10-year Treasury yield climbed to 4.687%, its highest since January 2025. For investors, that matters because gold pays no interest: when Treasury yields rise, the opportunity cost of holding bullion rises too. A stronger dollar adds another headwind by making gold more expensive for buyers using other currencies.

Gold had already come under pressure a day earlier, when it fell 1.4% to $4,503.98 an ounce. Inflation fears kept expectations for higher rates elevated, and the metal’s slide showed how quickly the market can shift from buying safety to buying yield. For retirement savers, that tilt favors bonds and cash-like instruments over non-yielding assets. For gold buyers, it means the metal becomes harder to justify unless inflation, conflict or financial stress intensifies again.

Geopolitical risk did not disappear. President Donald Trump said negotiations with Iran were “in the final stages” and warned of further attacks unless Tehran agrees to a peace deal. Two Chinese tankers laden with oil also exited the Strait of Hormuz, a reminder that shipping routes and energy prices could still swing sharply if the conflict widens. But on Wednesday, the market’s immediate focus stayed on rates and currencies, not on safe-haven demand alone.

The broader precious-metals market was subdued, with silver, platinum and palladium showing only limited moves. Even so, gold remained far above year-ago levels, and analysts still see structural support underneath the metal. A Reuters survey in 2026 showed a median gold price forecast of $4,916 an ounce for the year, reflecting expectations that central bank buying and persistent macro uncertainty could keep the long-term floor high, even if higher yields and a firmer dollar continue to cap rallies in the near term.