Gold Moves Lower Again as Safe Haven Demand Moderates While the Dollar and Yields Rise

Gold traded lower early on Thursday, falling for a fourth day as the price of the metal corrects after closing at a record high last week and the dollar and treasury yields moved higher. Gold for June delivery was last seen down US$6.90 to US$2,331.50 per ounce. The drop comes as the dollar and treasury yields rose after the U.S. Bureau of Economic Analysis reported first-quarter gross domestic product rose by 1.6% in the first quarter, well under the consensus estimate for a 2.2% rise, according to MarketWatch, and under the 3.9% rise in the fourth quarter of 2023. "Commodities will be watching today's U.S. GDP and could weaken should the print further weaken the conviction on Fed rate cuts. Gold remains in correction mode but holding above $2300 ahead of key support in the $2250-60 area," Saxo Bank noted. Gold closed at a record US$2,413.80 on Friday, but has since dropped every day this week as tensions between Israel and Iran cool, lessening concerns over a wider Middle East war. The dollar rose following the GDP report, with the ICE dollar index last seen up 0.12 points to 105.98. Treasury yields also climbed, bearish for gold that offers no interest. The US two-year note was last seen up 7.7 basis points to 5.018%, while the 10-year note was paying 4.73%, up 8.4 basis points.