Gold rises as markets await US employment data

Gold prices edged higher on Thursday as pressure from a stronger dollar and rising US Treasury yields offset the impact of softer-than-expected US inflation data, which reduced market expectations for a Federal Reserve interest rate hike in October.

Spot gold rose 0.4% to $4,171.19 an ounce by 2:19 p.m. ET, while US gold futures for December delivery settled 0.4% higher at $4,202.30 an ounce. Gold prices had fallen more than 6% in September.

The 10-year US Treasury yield climbed to its highest level in more than two decades, increasing the opportunity cost of holding gold, while a stronger dollar made the US currency-denominated precious metal more expensive for holders of other currencies.

Oil prices also rose, fueling inflation concerns after China suspended exports of petroleum products, a move that could further tighten fuel markets already facing global supply shortages.

Inflation data reduce rate-hike expectations

Supporting the precious metal, data released on Wednesday showed that US inflation rose less than expected in August, while price pressures for the previous month were revised lower.

The data reduced expectations for an October interest rate hike, with markets now pricing in a 28% probability of a rate increase, down from 45% before the data and 69% a week earlier.

Investors are now awaiting Friday’s US nonfarm payrolls report for September for further clues on the monetary policy outlook.

Meanwhile, HSBC lowered its average gold price forecasts for 2026 and 2027 to $4,490 an ounce and $4,825 an ounce, respectively, saying gold could face further near-term pressure but is likely approaching a price bottom.

The bank added that it expects central banks to resume gold purchases in response to lower prices, particularly when prices approach or fall below $4,000 an ounce.