NEW YORK / RankWire.AI / – Gold approached a seven-week peak on Thursday, posting its most substantial daily increase since February. Spot gold gained 0.5% to reach $4,265.22 per ounce by 0330 GMT, following a 4.4% rise in the previous session. December U.S. gold futures also increased by 0.5%, settling at $4,324.60 after a 4% jump on Wednesday. The decline in Treasury yields coupled with a softer dollar supported broader gains across precious metals markets.
The recent advance on Thursday kept gold prices above the 50-day moving average near $4,160, a level it had mostly stayed below during its recent decline. Prices climbed back to levels last seen on June 18, with a gain of over 5% from Monday’s close. Although the rally moved gold further from its May highs when spot prices topped $4,500 an ounce, it still recovered a significant portion of June and July losses.
U.S. Treasury yields declined as gold prices gained strength. The benchmark 10-year yield stayed near 4.61%, down from approximately 4.74% at the end of July, while the two-year yield was close to 4.18% on Wednesday. Since gold does not pay interest, falling bond yields reduce the income gap between bullion and government debt. Meanwhile, the dollar depreciated against major currencies, making gold more affordable for buyers using other currencies.
Gold rally linked to shifts in bond markets
Market movements were further influenced by recent labor market data. Private employers added 44,000 jobs in July, following a revised increase of 95,000 in June. This July figure marked the smallest monthly gain in six months. The Federal Reserve maintained its benchmark interest rate at 3.5% to 3.75% on July 29. Additionally, the broader employment report from the government, which covers hiring across public and private sectors, remains scheduled for release on Friday.
Prior to Wednesday’s sharp rebound, gold experienced consistent downward pressure, with spot prices near $4,008 on July 20 and approximately $4,052 on August 3. Wednesday’s 4.4% surge marked the strongest single-day performance in about six months. The following day’s gains kept bullion near the top of its recent trading range. Both spot and futures prices stayed well above their early-week levels, with market activity primarily focusing on yields and currency movements.
Central banks continue to be significant gold purchasers
Official and institutional demand continued to shape the overall gold market. The World Gold Council reported demand of 1,269 metric tons during the second quarter, including over-the-counter transactions, matching the same period last year. In the first half of the year, demand increased by 2%, totaling 2,522 tons. Countries such as Poland, Uzbekistan, China, and Kazakhstan ranked among the largest central-bank buyers during this timeframe. Additionally, higher average prices boosted the total value of gold demand in the first six months.
Other precious metals experienced mixed performance during Thursday’s trading session. Silver declined slightly by 0.1% to $62.02 an ounce, whereas platinum advanced by 1.2% to $1,755.18. Palladium increased by 0.8% to $1,374.33, marking its third consecutive rise. Despite these moves, gold remained the most prominent focus after Wednesday’s surge, maintaining near a seven-week high as Treasury yields fell and the dollar weakened, extending its rebound above key recent levels.