2023.12.2717:56:00UTC+00Gold Futures Settle Notably Higher As Dollar, Bond Yields Drop Again

Gold prices climbed higher on Wednesday, as the dollar weakened and long term bond yields dropped amid rising expectations the Federal Reserve will lower interest rates as early as March 2024.

Rising geopolitical tensions contributed as well to increased demand for the safe-haven asset.

The dollar index dropped to 100.83 before noon, and despite recovering to 100.95 subsequently, remained well below the unchanged line, losing nearly 0.5%.

Yield on 10-year Treasury Note dropped to 3.791% today, falling to a more than 5-month low.

Treasury yield declined after the Treasury Department revealed this month's auction of $58 billion worth of five-year notes attracted average demand.

Gold futures for February ended up $23.30 at $2,093.10 an ounce.

Silver futures for March ended higher by $0.245 at $24.641 an ounce, while Copper futures for March settled at $3.9595 per pound, gaining $0.0575.

Data from the Commerce Department last week showed the annual rate of consumer price growth decelerated to 2.6% in November from a downwardly revised 2.9% in October. Economists had expected the pace of price growth to slow to 2.8% from the 3% originally reported for the previous month.

The annual rate of growth by core consumer prices, which exclude food and energy prices, also slowed to 3.2% in November from a downwardly revised 3.4% in October. Economists had expected core consumer price growth to decelerate to 3.3% from the 3.5% originally reported for the previous month.