Gold holds near $4,180 as Fed signals and bond yields shape market outlook
Gold steadies despite weekly decline
Spot gold was trading around $4,180 per ounce, with prices up slightly from the previous session. However, bullion remained on track for a weekly decline of more than 2%, according to market reports.
US Treasury yields eased after the 10-year yield had climbed to its highest level since 2002. The decline in yields provided some relief for gold, which does not pay interest and generally faces pressure when bond yields rise.
Gold had faced significant pressure during September as rising Treasury yields and expectations of further Federal Reserve rate increases reduced demand for the non-yielding asset. Prices fell about 6% during the month.
Fed outlook remains key for gold
Federal Reserve officials have indicated that they need more economic data before deciding on the next interest-rate move. Recent comments from senior officials have reduced expectations of an immediate October rate increase, although policymakers remain concerned about inflation.
Meanwhile, geopolitical tensions in the Middle East and concerns over France’s fiscal position are supporting demand for safer assets, while elevated energy prices continue to add uncertainty to the inflation outlook.
Investors are now watching US economic data, particularly the jobs report, for fresh clues about the Federal Reserve’s monetary policy and the future direction of gold prices.
