Gold rebounds 2.1% to $3,954.41 as oil retreats and rate bets shift
Key Facts
Spot gold rose 2.1% to $3,954.41 an ounce at 1:49 p.m. Eastern time on November 2, after hitting its lowest level since October 2025 in the previous session, according to Reuters. EL7’s XAUUSD spot gold series closed at $3,929.01 an ounce, compared with $3,875.645 on October 30. In the GCUSD series, the close was $3,969.6, versus $3,898.9 in the previous session. These figures reflect the closes of two different series, rather than the live spot price. U.S. gold futures for December delivery closed 1.8% higher at $3,969.60 an ounce, according to Reuters.
Gold ended Friday’s session down 3.6%, at its lowest level since October 2025, according to Reuters. Against the backdrop of the previous monthly decline, the World Gold Council said gold ended September at $4,176 an ounce, down 8.5% from the previous month. The council attributed part of September’s decline to rising U.S. Treasury yields, a stronger dollar and reduced futures positioning. The 10-year U.S. Treasury yield rose 53 basis points to 5.3%, while the dollar index gained 2% during the month. As prices fell, global gold exchange-traded funds recorded inflows of $10 billion, equivalent to 67 tonnes, in September.
Gold’s recovery coincided with a retreat in oil, with prices falling about 8% on November 2 after Iran and Qatar held a third consecutive day of talks aimed at ending the U.S.-Israeli war on Iran, according to Reuters. Brent crude fell 7.6% to $104.77 a barrel during the session, according to the Associated Press. Lower fuel prices lifted shares of companies with high fuel costs: United Airlines rose 4.8%, Southwest gained 3.6% and Carnival advanced 4.2%. Peter Grant, vice president at Zaner Metals, said, "Lower oil prices provided some relief by easing inflation concerns." But he noted that the market continued to expect a Federal Reserve rate hike in December, although the odds had edged down over the previous two sessions.
Traders put the odds of a U.S. rate hike in December at 77% on November 2, down from 80% a week earlier, according to Reuters. The Federal Reserve kept its target rate range at 3.75% to 4% on October 28, in a decision approved by a 10-to-2 vote. The two dissenting members favored raising the range by a quarter of a percentage point. Meanwhile, gold’s 14-day relative strength index rose to about 37 on Monday, after being below 30 on Friday. The reading indicated that the index had moved out of technically oversold territory, as the price rebounded from its lowest level in a year.
On official-sector demand, the People’s Bank of China added 23 tonnes of gold in September, its largest monthly addition since October 2023, bringing its purchases in the third quarter to 63 tonnes, according to the World Gold Council. On U.S. fiscal policy, Julius Baer analyst Carsten Menke said the U.S. deficit was likely to persist regardless of the midterm election outcome. He added that U.S. debt and its interest burden could remain supportive factors for gold over the longer term. Investors’ attention turned to the U.S. midterm elections scheduled for November 3, with a focus on what they could mean for fiscal policy, geopolitics and market sentiment. These issues set a mixed backdrop for gold, shaped by official demand, rate expectations and U.S. fiscal factors.
After the election, the U.S. October jobs report is due on November 6, according to the Bureau of Labor Statistics. The consumer price index for the same month is scheduled for release on November 10 at 8:30 a.m. Eastern time. The labor and inflation data are due as traders monitor the rate path and inflation estimates. The market put the odds of a rate hike in December at 77% on November 2, compared with 80% a week earlier. Investors are watching how the upcoming data could affect monetary policy expectations at the Federal Reserve’s next meeting.