Gold declined in the past two months as speculation mounted that the Fed’s benchmark rate would increase. Treasury yields have been held down by the three rounds of large-scale asset purchases that have swelled the central bank’s balance sheet by $4.47 trillion.
Higher borrowing costs cut gold’s allure because the metal generally offers returns only through prices gains, sending investors to assets with better yield prospects such as bonds. Traders are parsing economic data to assess the outlook for the timing of a rate increase. The government on May 8 releases statistics on jobs.
Gold futures for June delivery fell 0.2 percent to settle at $1,190.30 an ounce at 1:46 p.m. on the Comex in New York. Aggregate trading was 24 percent below the 100-day average, data compiled by Bloomberg show. The price rose 1.6 percent in the past two days.
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