The shine for the yellow metal seems to be dulling with gold prices falling nearly ₹10,000 from the peak it scaled in August 2020. In fact, gold is now headed for a second monthly decline as it sinks towards an 8 month low.
Stronger returns in the US bond market with global central banks continuing to support growth has dulled demand for gold. Meanwhile, Goldman Sachs has cut its gold forecast, citing rising risk appetite for assets as a factor for the price underperformance.
Rising bond yields have always led to lower gold prices and with US yields hovering near 1 year high the demand for gold and thus the prices have seen a consistent correction. In fact, reports indicate holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, have fallen to their lowest since May 2020