Home Topics Business Gold down, dollar up as investors drive US Treasury auctions higher

Gold down, dollar up as investors drive US Treasury auctions higher

© Reuters.

From Gina Lee

Investing.com – Gold was down in Asia on Monday morning as yields remained buoyant and 10-year government bond yields remained near their highest level in more than a year.

The dollar fell 0.09% to $ 1,740.15 by 12:25 a.m. ET (4:25 a.m. GMT) on Monday, and the dollar rose on Monday.

US Treasury auctions of two-, five-, and seven-year debt later this week are also on investor radar. Large US banks will again have to hold an additional layer of loss-absorbing capital against US Treasuries and central bank deposits from April after the US Federal Reserve announced on Friday that it would not extend a temporary COVID-19 regulatory hiatus due to expiry in March 2021.

Fed chairman Jerome Powell reiterated in an editorial in the Wall Street Journal that the Fed will continue to aid the economy “as long as possible,” although the recovery is far from over. He added the US was “pulling out of the COVID-19 crisis stronger and better, as we have done so many times”.

Investors also look to the BIS Innovation Summit later in the day, which features Powell on the list of speakers alongside other central bank leaders including Christine Lagarde of the European Central Bank and Andrew Bailey of the Bank of England.

Powell and Treasury Secretary Janet Yellen will make their first joint appearance on Tuesday before the US House Financial Services Committee to testify on the Fed and Treasury Department’s COVID-19 policy.

On the other side of the Atlantic, the Turkish governor of the central bank, Naci Agbal, also drove investors to the safe-haven dollar over the weekend. The replacement of Agbal by Sahap Kavcioglu by President Recep Tayyip Erdoğan also sparked fears of turbulence in other financial markets.

In Asia, the People’s Bank of China was flat at 3.85% earlier in the day.

In other precious metals, palladium rose 0.2%. However, silver fell 1.2% and platinum 1.3%.

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