Gold Rebounds 1.7% as Dollar and Treasury Yields Slide
Gold for December delivery rose $69.40 to $4,177.30 an ounce as the dollar and ten-year yields fell, even though September producer prices came in hotter than expected.
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what happened
Gold prices surged on Thursday, ending a three-session slide in which the metal had lost 2.5%. December delivery contracts climbed $69.40, or 1.7%, to $4,177.30 an ounce.
Support came from a weaker U.S. dollar, with the dollar index sliding 0.5% on the day. Yields on the benchmark ten-year Treasury note dropped by more than 10 basis points, extending a sharp pullback from the previous session. Traders appeared to look past a Labor Department report on producer prices.
The report showed the producer price index for final demand jumped 1.3% in September, well above the 0.5% economists had expected. The annual growth rate accelerated to 6.3% from an upwardly revised 5.6% in August. Still, CME Group's FedWatch Tool suggests the Federal Reserve is likely to keep rates unchanged at its meeting later this month.
why it matters
For non-yielding gold, a weaker dollar and lower Treasury yields typically create a supportive backdrop. However, the hotter inflation data complicates the picture, and the metal's next move will likely depend on how the market reads the Federal Reserve's future rate decisions.
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prepared by the newsmetry newsroom with ai assistance from the sources listed below. not investment advice.
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