gold and silver prices settled lower on wednesday following us data showing wholesale prices climbed more than the market expected in september feeding expectations that the federal reserve will continue to aggressively raise interest rates us wholesale prices rose 04 in september to mark the first increase in three months economists polled by the wall street journal had forecast a 02 gain wednesdays strongerthanexpected reading on producer prices validates the feds aggressive pace of rate hikes even if those measures eventually cause damage to the overall economy said ryan belanger founder and managing principal at wealth management firm claro advisors in emailed commentary the rise in producer prices in september suggests that thursdays consumer price index will likely also remain elevated as the prices consumers pay for goods in the future are derived from the prices that producers pay today he said higher interest rates can boost the dollar and dull demand for dollardenominated commodities rising yields on government debt can also be a headwind for gold as it raises the opportunity cost of holding nonyielding assets the ice us dollar index  a gauge of the dollars strength against a basket of rival currencies had traded as high as 113592 before easing back following the release of minutes from the feds last policy meeting which were released after gold futures settled for the session the yield on the 10year treasury note also fell to 3897 after a high of 3974 gold futures eased back from their settlement in electronic trading to 1683 readfed saw too much action vs high inflation as less risky than too little minutes show gold is being influenced by bond yields and any messaging on interest rates and the attempt to rein in inflation from the fed jeff wright chief investment officer at wolfpack capital told marketwatch the ppi reading coming in higher than expected due to services rather than durables was not a good sign for the consumer price index data due out thursday he said wright said he does not see the fed raising rates prior to the november meeting but could accelerate quantitative tightening measures to move interest rates higher in the interim ole hansen chief commodity strategist at saxobank said in a note wednesday that fluctuations in treasury yields and the value of the dollar have taken gold and other commodities on a rollercoaster ride in recent weeks commodity markets continue to attract a great deal of directional inspiration from the price action across financial markets he said however theres still reason to be long gold hansen said citing the risk of a fed policy mistake that could provoke a reversal in stocks bonds and the dollar looking ahead we see no reason to change our longterm bullish view on gold with support potentially coming from the risk of a policy mistake sending us economic growth the dollar and bond yields lower he said