Gold Recovers From Two-Month Low
Gold prices recovered on Thursday after falling to their lowest level in two months as the U.S. dollar eased from an 18-month high.
Spot gold rose 0.5% to $4,132.66 per ounce by 0140 GMT. U.S. gold futures for December delivery gained 0.4% to $4,157.60.
The recovery came after gold prices touched their lowest level since August 5 during the previous session. A stronger dollar and higher U.S. Treasury yields had pressured bullion by making the metal more expensive for investors holding other currencies.
Fed policy remains central to gold
Investors continue to focus on the Federal Reserve’s interest-rate outlook.
Minutes from the Fed’s September meeting showed that policymakers were divided over the reasons for the previous rate increase. Some saw the hike as necessary to contain the impact of energy and other price shocks, while a more hawkish group viewed it as necessary to prevent demand-driven inflation from becoming more persistent.
Markets currently price in only an 18% probability of an October rate hike, while the probability of a December increase is around 80%.
Higher interest rates generally weigh on gold because bullion does not generate interest income.
Analyst sees key level at $4,275
Chris Weston, head of research at Pepperstone, said the short-term investment case for gold remains challenging. He said a move above $4,275 would be needed to create a more constructive near-term outlook.
Gold could potentially behave differently if investors begin interpreting higher long-term bond yields as evidence of sovereign credit and fiscal risks rather than stronger economic growth.
The broader economic environment also remains important. IMF Managing Director Kristalina Georgieva has warned that persistent energy prices, record public debt and risks linked to the AI investment boom pose threats to the global economy.
Other precious metals also gained. Silver rose 0.4% to $60.36 an ounce, platinum increased 1.8% to $1,660.05, and palladium climbed 1.6% to $1,142.
