September Treasury Bonds surged to the upside once again as traders flocked to the safety of the lower yielding Treasury market. In addition, the weak U.S. economic data means the Fed is likely to keep interest rates down for a prolonged period of time.
Ten-Year Treasury futures made a new high for the year. This move reflects both fear in holding higher yielding assets and confidence that the Fed will be forced to keep interest rates low.
August Gold closed sharply lower on the heels of the poor economic news. Investors are pricing in a low inflation environment. A break through the recent bottom at $1185.00 is likely to trigger a further decline into a key 50% retracement level at $1158.30.