Gold Rises 0.8% to $3903.90 After Oil Falls and Sharp Previous Decline
Key Facts
Spot gold rose 0.8% to $3903.90 an ounce by 07:57 GMT on November 2, after hitting its lowest level in a year in the previous session, Reuters reported. The report attributed the rebound to falling oil prices, which eased inflation concerns, and to investors assessing comments from Federal Reserve officials for clues about the path of U.S. interest rates. The move followed a sharp decline in the metal at the end of the week, making Monday’s gains a recovery from recent losses rather than an independent sign of a shift in the market’s direction. A Capital.com analyst said the market was "seeing a rebound after the selloff, alongside falling oil prices at the start of the week."
Gold had fallen 3.5% on Friday, October 30, reaching its lowest level since October 2025 and slipping below $4000 an ounce, according to Reuters. The report linked the selloff to a decline in technology stocks that triggered margin calls, as investors needed liquidity to meet those demands. The GCUSD gold contract closed at 3898.9 on October 30 and at 3913.6 on November 2, according to EL7 data. XAUUSD also closed at 3875.645 on October 30, compared with 3957.92 on November 2, the same data showed. These prices reflect daily closes for two different instruments, while Reuters’ reading for spot gold on Monday morning was $3903.90 an ounce.
Oil fell more than 3% on November 2 after a Reuters report said Iranian negotiators were in Doha on Sunday for a third consecutive day, holding talks with Qatari mediators aimed at advancing an agreement to end the U.S.-Israeli war on Iran. The decline in energy prices gave inflation concerns some relief, as those concerns could lead central banks to keep interest rates elevated. Reuters said high energy prices often reinforce expectations that rates will remain higher for longer, increasing the opportunity cost of holding non-yielding gold. Gold’s support during the session was therefore linked to the easing of one source of pressure on rate expectations, not to confirmed U.S. manufacturing data. The manufacturing PMI reading attributed to November 2 in the previous draft was unconfirmed on the official Institute for Supply Management page reviewed in the evidence.
Monetary policy signals remained mixed. Three Federal Reserve officials on Friday called for further rate increases to counter elevated inflation, Reuters reported, after policymakers left short-term borrowing costs unchanged at the previous week’s meeting. In its October 28 decision, the Fed kept the federal funds target range between 3.75% and 4%, while two members preferred a quarter-percentage-point increase. The central bank said economic activity was expanding at a solid pace and inflation remained elevated, adding that the accumulation of further information would help the committee determine the appropriate policy stance. This means gold’s rebound came amid conflicting messages: the latest decision held the range steady, while some officials called for further increases.
Bureau of Labor Statistics data showed that compensation costs for civilian workers rose 0.8% in the three months ended September 2026, after a 0.9% increase in the second quarter, according to the comparison included in the correction. The quarterly increase included a 0.7% rise in wages and salaries and a 0.9% increase in benefit costs. In the 12 months ended September, compensation costs rose 3.4%, while wages increased 3.1% and benefits 3.9%. The figures show two different trends: quarterly compensation growth slowed from the previous quarter, while costs continued to rise on an annual basis. On October 28, spot gold rose in volatile trading after the Fed decision, while the global equity index gained 0.38% to 1,134.03 points, according to a Reuters report published via Euronext.
Attention now turns to U.S. labor-market data. The September Job Openings and Labor Turnover Survey is scheduled for release on November 3 at 10:00 a.m. Eastern Time, according to the Bureau of Labor Statistics calendar. The October Employment Situation report, including jobs and unemployment data, is due on November 6. The bureau has also set November 10 for the release of the October Consumer Price Index. These releases follow the Fed’s statement that further information will help it determine the policy stance, with its next meeting scheduled for December 8 and 9, a meeting associated with the Summary of Economic Projections.