Why gold and silver fell for a third day in a row

By Myra P. Saefong

Gold and silver settled sharply lower Thursday, extending losses into a third straight session a day after minutes from the Federal Reserve showed that some policymakers were willing to raise interest rates if needed to fight inflation.

The Fed officials at the May meeting expressed dismay about "disappointing" inflation readings, saying the most recent data "pointed to more persistence in inflation in coming months," the Fed minutes showed.

Following the release of the minutes, "traders moved to price in November as the more likely timing for the first Fed rate cut, driving higher Treasury yields BX:TMUBMUSD10Y and a stronger dollar DXY, which caused losses for the non-yielding precious metal," Ricardo Evangelista, senior analyst at ActivTrades, said in market commentary.

Read: What record highs for gold, silver and copper are saying about the economy

On Comex Thursday, gold for June delivery (GC00) (GCM24) lost $55.70, or 2.3%, to settle at $2,337.70 an ounce. Prices for the most active contract posted their largest daily percentage loss since April 22, according to Dow Jones Market Data.

Gold had marked a fresh record high settlement on May 20 at $2,438.50.

Read: Gold and copper are breaking records. Silver is at an 11-year high. But the narratives vary.

July silver (SI00) (SIN24) lost $1.04, or 3.3%, to settle at $30.46 an ounce, marking the lowest finish in a week.

Silver prices, however, were still up 26.4% year to date. Prices touched a high at $32.75 on Monday, the highest intraday level for a most-active contract since late January 2013.

"Gold's uptrend remains intact, but the risk of a more-pronounced pullback near term have risen given the uptick in volatility in the yellow metal," analysts at Sevens Report Research wrote in Thursday's newsletter.

-Myra P. Saefong

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05-23-24 1443ET

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