The price of gold widened its recent price losses earlier in the week with an initially rapid decline. The price drop was sparked by the strength of the US dollar after surprisingly strong US labor market data, which heightened speculation that the US Federal Reserve would exit extremely accommodative monetary policy. As a result, gold and silver precious metals, mostly traded in dollars, initially became more expensive in countries outside the dollar zone, which also slowed demand on Monday. The price of a troy ounce of gold has therefore fallen at times by 4.4% to $ 1,685. This meant a loss of $ 100 in two trading days. Some larger investors probably wanted to sell gold positions early in the week, traders said. This is supported by the fact that the price was able to partially offset the decline being traded, so the troy ounce traded again at $ 1,729 in the early evening. That means it cost just under two percent less than Friday. A similar development was evident in the price of silver. The price fell to $ 22.63 and recently rebounded to $ 23.41.
The recovery in the US labor market has pushed 10-year US Treasury yields up to 1.32% after hitting their lowest level since February at 1.169% two trading days ago. This jump boosted the dollar, pushing the euro down from $ 1.1820 to $ 1.1750.
The rising dollar has put additional pressure on oil prices. European Brent is 2.3% cheaper at $ 69.09. Last week, oil prices had already lost about six percent. The rise in corona infections in Asia has also made commodity investors cautious. They feared that further restrictions in China in particular would slow the global recovery in fuel demand.