Yahoo Finance
What happened:Gold futures (GC=F) tumbled more than 2% on Wednesday to trade near $4,000 per troy ounce.
What's behind the move:The precious metal declined as the US dollar (DX-Y.NYB) rose, and investors awaited a key inflation report due on Thursday.
The Personal Consumption Expenditures (PCE) index is the Federal Reserve's preferred gauges of inflation.
The report comes after Fed Chair Kevin Warsh reiterated last week that the central bank remains focused on bringing inflation down, remarks the market interpreted as hawkish.
"The combination of higher bond yields, a firmer dollar, and expectations that policy rates may remain elevated for longer continues to challenge investor appetite for non-yielding assets," Ole Hansen, Saxo Bank's head of commodity strategy, wrote Wednesday.
From a technical standpoint, the $4,000 to 4,100 range "remains critical", said Hansen.
"A sustained break below that zone risks triggering a fresh wave of capitulation and momentum-driven selling following the sharp correction already seen from this year's record highs." What else you need to know:Precious metals have underperformed broader markets since the Iran war began in late February, with gold prices falling roughly 24%.
The sell-off has accelerated as inflation readings have come in hot, driven by elevated oil prices.
Investors worry that even as crude prices have retreated, sticky inflation and a resilient labor market could prompt the Fed to keep interest rates unchanged for longer or even raise them before the year ends.
Year to date, bullion is down more than 7% after reaching a record high in late January.
Ines Ferre is a senior business reporter for Yahoo Finance.
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| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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