NEW YORK / RankWire.AI / – Gold approached a seven-week peak on Thursday, marking its most substantial daily increase since February. The spot price of gold increased by 0.5% to reach $4,265.22 an ounce by 0330 GMT. This followed a 4.4% rise in the previous trading session. December U.S. gold futures grew 0.5% to $4,324.60 after climbing 4% on Wednesday. The decline in Treasury yields alongside a weaker dollar contributed to the broader upward movement across the precious metals markets.
Thursday’s upward move kept gold above its 50-day moving average of approximately $4,160. For much of its recent decline, bullion had traded below this technical indicator. Prices rebounded to levels last seen on June 18 and were more than 5% higher than Monday’s close. Although the rally has not yet surpassed the highs recorded in May, when spot prices exceeded $4,500 an ounce, it has recovered a significant portion of the losses experienced during June and July.
U.S. Treasury yields declined as gold prices surged. The benchmark 10-year yield stayed near 4.61%, down from about 4.74% at the end of July. The two-year yield hovered around 4.18% on Wednesday. Since gold doesn’t pay interest, decreasing bond yields lessen the income differential between bullion and government debt. Meanwhile, the dollar weakened against several major currencies, making gold less expensive for buyers using currencies other than the dollar.
Gold rally accompanied by shifts in bond markets
Labor market data added context to the economic environment influencing the market. Private employers added 44,000 jobs in July, following a revised increase of 95,000 in June. The July figure represented the smallest monthly gain in six months. On July 29, the Federal Reserve maintained its benchmark interest rate between 3.5% and 3.75%. The government’s comprehensive employment report, which includes public and private sector hiring, is scheduled for release on Friday.
Gold had previously faced persistent downward pressure before Wednesday’s sharp rebound. Spot prices hovered around $4,008 on July 20 and $4,052 on August 3. The 4.4% surge on Wednesday marked the best single-day performance for the metal in roughly six months. Thursday’s gains kept bullion near the upper boundary of its recent trading range. Both spot and futures prices remained significantly above their levels earlier in the week, with trading activity largely focused on yields and currency movements.
Central bank purchases continue to drive gold demand
Official and institutional buyers sustained their influence over the broader gold market. The World Gold Council reported second-quarter demand totaling 1,269 metric tons, including over-the-counter transactions. This demand matched the figures from the same period last year. In the first half of the year, demand increased by 2% to reach 2,522 tons. Notable central-bank purchasers during this timeframe included Poland, Uzbekistan, China, and Kazakhstan. The rise in average prices also contributed to the higher total value of gold demand in the first six months.
Thursday’s session saw mixed performances among other precious metals. Silver dipped 0.1% to $62.02 an ounce, while platinum rose 1.2% to $1,755.18. Palladium increased 0.8% to $1,374.33, marking its third consecutive gain. Despite these movements, gold remained the main focus after Wednesday’s rally. The metal’s prices stayed near a seven-week high, supported by falling Treasury yields and a weaker dollar, which extended the rebound that pushed bullion above key recent levels.