At press time, gold futures were down by 0.11%, to trade at $1,714 an ounce.
Many factors contributed to the record selloffs in the bullion asset during the first quarter of this year such as low inflation expectations, and a rise in the value of the U.S dollar, U.S Treasury Yields and Bitcoin.
READ: Stock Market end first quarter in deep red
The surging dollar, gold’s archenemy, has powered higher so far, at the expense of gold, which strayed near negative market territory at least twice in March when it lost 20% from its August record high.
In addition, the precious metal has been under immense pressure from a stronger U.S economy, and further compounding the woes of gold bugs, are macros pointing to a $2.25 trillion, eight-year “American Jobs Plan” released by President Joe Biden in aiding the world’s most powerful economy.
READ: Gold drops to a nine-month low, U.S Fed Chief disappoints metal buyers
Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics spoke on why gold prices are rallying above $1,700 price levels despite the rallying U.S Treasury Yields.
With UST 10-year yields still above 1.70 and the dollar sailing on an even keel, gold seems to have been a significant beneficiary of month-end rebalancing.
What to expect: It is critical to note that the precious metal has underperformed U.S 10-year bonds by 5% and U.S equities by around 15-20%. If there is a need to rebalance portfolios, investors will likely buy the precious metal at the current levels.