Gold attempts to extend winning streak to 4 sessions

Gold has gained ground even as U.S. Treasury yields continue to rise, with the 10-year yield trading near a 2.8% for the first time since January 2019. Rising yields raise the opportunity cost of holding nonyielding assets like gold.

The U.S. March consumer-price index, or CPI, reading is due at 8:30 a.m. ET. Economists surveyed by The Wall Street Journal expect the data to show a 1.1% monthly rise, which would put the year-over-year rate at 8.4%, up from 7.9% in February.

Core CPI, which strips out volatile food and energy costs, is expected to show a 0.5% monthly rise and a 6.6% year-over-year increase after a 6.4% increase in February.

“Hotter than expected inflation would likely provide some additional buoyancy for gold but may also intensify the Fed’s already hawkish tenor,” said Peter Grant, senior metals strategist at Zaner Metals and Tornado Precious Metals Solutions, in a note.

“Real rates based on 10-year TIPs (Treasaury inflation-protected securities) are approaching 0% for the first time since early in the pandemic,” he said. “The sharp rise in real rates threatens to further undermine risks assets, including stocks and cryptocurrencies. If stocks go back on the defensive, gold may benefit from haven flows.”