Gold prices moved higher on Thursday, climbing back above $4,400 an ounce after gaining around 1% in the previous session.
A weaker U.S. dollar and lower Treasury yields helped support bullion, easing some of the pressure created by recent expectations for higher Federal Reserve interest rates.
Investors are now turning their attention to Friday’s U.S. nonfarm payrolls report for the next major signal on monetary policy.
Gold Price Rises Above $4,400
At 01:10 ET, spot gold rose 0.9% to $4,429.23 an ounce.
Gold Futures gained 1.4% to $4,474.75.
Other precious metals also moved higher. Silver rose 0.6% to $65.75 an ounce, while platinum increased 0.8% to $1,774.92.
Meanwhile, the U.S. Dollar Index fell 0.2% to 99.39.
A weaker dollar generally supports gold because it makes the metal cheaper for buyers using other currencies.
Fed Comments Ease Rate Hike Concerns
Federal Reserve Bank of New York President John Williams gave investors another reason to reconsider the outlook for interest rates.
Williams said there were signs that U.S. inflation was continuing to ease as the effects of tariffs faded.
He also noted that higher energy prices had not significantly spread into other parts of the services economy.
These comments helped reduce some of the market’s concerns about aggressive Federal Reserve tightening.
U.S. Job Growth Slows
Fresh labor market data also pointed to softer economic conditions.
U.S. companies added 38,000 jobs in August, according to the ADP employment report.
The slower pace of hiring helped reduce expectations that the Federal Reserve would need to raise interest rates aggressively.
This followed a more hawkish message from Fed Chair Kevin Warsh during his Jackson Hole speech last Friday.
Warsh’s comments had previously increased expectations that policymakers could raise rates at their upcoming meeting.
Lower Treasury Yields Support Gold
Gold’s rebound has now extended into a second consecutive session.
The precious metal had fallen to a near four-week low on Wednesday before recovering.
The latest rise comes as both the U.S. dollar and Treasury yields retreat from recent highs.
Lower bond yields tend to support gold because the metal does not pay interest. When yields fall, the opportunity cost of holding gold becomes less significant.
U.S.-Iran Tensions Remain in Focus
Geopolitical developments also continue to influence gold prices.
President Donald Trump said the latest U.S. strikes on Iran were likely to be short-lived.
His comments helped slow the recent rise in oil prices and reduced some concerns about renewed inflation pressures.
Markets had been worried that a prolonged conflict could disrupt energy supplies and push oil prices higher.
More expensive energy can increase inflation and make it harder for the Federal Reserve to ease monetary policy.
Gold Gains as Dollar Weakens
Gold rose as much as 1.6% on Wednesday as the U.S. dollar weakened following a sharp rise in the Japanese yen.
The move in the yen also renewed speculation about possible currency intervention, adding further pressure on the dollar.
With the dollar softer and bond yields easing, gold has regained some momentum after its recent decline.
Investors will now focus on the upcoming U.S. jobs report and Federal Reserve policy expectations for further direction in gold prices.
