Gold prices drop as U.S. Treasury yields hit their highest since 2018

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Gold prices drop as U.S. Treasury yields hit their highest since 2018

The 10-year U.S. Treasury yields hit their highest since November 2018, pushing prices of zero-yield gold.

On Monday, gold prices went down as elevated U.S. Treasury yields and a firm dollar pressured demand for greenback-priced bullion.

Spot gold fell by 0.1% to $1,880. As of 0049 GMT, 56 per ounce were down 0.2% to $1,879. The 10-year U.S. Treasury yields hit their highest since November 2018, pushing prices of zero-yield gold.

The dollar was close to a 20 year high against its rivals, making it less attractive for other currency holders.

The U.S. job growth increased more than expected in April as manufacturers boosted hiring, underscoring the economy's strong fundamentals despite a decline in output in the first quarter.

Two of the Federal Reserve'sFederal Reserve's most outspoken policy hawks pushed back Friday on the belief that the U.S. central bank missed the boat in the fight against high inflation, citing a tightening of financial conditions that began well before the Fed began raising interest rates in March.

While gold is seen as a safe store of value during times of political and economic crises, it is highly sensitive to rising short-term U.S. interest rates and bond yields, which raises the opportunity cost of holding bullion.

The regional governor said on Sunday as many as 60 people were feared to have been killed when a bomb struck a village school in eastern Ukraine, while Russian forces continued to shelling the last holdout of Ukrainian resistance in the ruined southeastern port of Mariupol.

Asian markets got off to a shaky start on Monday as U.S. stock futures took an early skid on rate worries while a tighter lockdown in Shanghai stoked concerns about global economic growth and possible recession.

Spot silver fell by 0.4% to $22.24 per ounce, platinum fell 1.2% to $951.69 and palladium dropped 0.2% to $2,042.