Gold futures on the COMEX for December delivery surged $152.60, or 3.67%, to settle at $4,305.20 per ounce on Wednesday. The rally was driven by the 10-year US Treasury yield falling near a one-week low and the dollar index weakening to 99.676 after President Donald Trump indicated progress in talks with Iran, raising hopes that the five-month-long conflict may be nearing an end. A weaker dollar makes gold more attractive for holders of other currencies, while lower bond yields reduce the opportunity cost of holding gold. Independent precious metals trader Tai Wong noted that investors are returning to the gold market as the outlook for Fed rate hikes diminishes and the dollar weakens. Meanwhile, data from the World Gold Council showed central bank gold demand in the first half of 2026 was at its lowest since 2022, and gold ETFs saw outflows of 45 tonnes in the second quarter, a period when gold prices posted their steepest quarterly decline since 2013, falling 14%. The latest ADP employment data revealed that US private sector hiring rose by only 44,000 jobs in July, well below the 75,000 analysts had expected. Investors are closely watching the nonfarm payrolls report due Friday, with analysts forecasting an increase of 88,000 jobs and the unemployment rate holding steady at 4.2%.
Gold rally driven by falling 10-year Treasury yield, which moves inversely to bond price, indicating yield decline.
