Silver lost about 6%, gold fell below $4,100 — The Rio Times

On October 14, after higher-than-expected inflation data were released in the United States, silver lost about 6%, while gold fell below $4,100. The Rio Times reports, citing Kitco.

In September, the US consumer price index rose by 0.6% month-on-month and by 3.7% year-on-year, while the forecast had projected 3.6%. Core prices increased by 2.6%, compared with expectations of 2.5%.

Market reaction

According to the publication, the data led to rising yields on US government bonds, a stronger dollar, and increased expectations of further tightening of the Federal Reserve's monetary policy. The DXY dollar index rose by 0.34% to about 102.5 points.

The GLD gold fund declined by 1.49% to $375.99. The silver-linked SLV fund fell by 6.11% to $50.22, while the GDX gold-mining companies fund lost 4.40% to $83.40.

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The Rio Times notes that higher yields and a stronger dollar make precious metals, which do not generate interest income, less attractive to investors.

Mining company shares

Shares of Pan American Silver, which has mines in Mexico and Peru, fell by 4.94% to $42.33. Securities of Peru's Buenaventura lost 3.11% and declined to $30.52.

Mexico is the world's largest silver producer, while Peru is among the top three producers. The publication expects that the further movement of precious metals will depend on US bond yields and the dollar exchange rate. The next important data for the market are expected to be US retail sales and unemployment claims figures, scheduled for October 15.