Gold price rebounds above $4,100 as US dollar weakens

Gold prices rose more than 1% on Thursday, rebounding from a one-week low as the US dollar weakened and Treasury yields declined. Spot gold traded at $4,156.52 an ounce at 9:30 a.m. EDT on October 15, according to Reuters, while December US gold futures were at $4,177.80. Prices can change rapidly during the trading session.

The move followed three consecutive sessions of losses. A softer dollar can make bullion cheaper for buyers using other currencies, while lower bond yields reduce the opportunity cost of holding gold, which does not pay interest.

The rebound came despite a hotter US inflation report. The Bureau of Labor Statistics said the Producer Price Index for final demand increased 1.3% in September, the largest monthly rise since March 2022. Producer prices were 6.3% higher than a year earlier. Goods prices increased 2.6%.

Those figures keep Federal Reserve policy at the center of the market debate. Strong inflation can support expectations for higher interest rates, which often strengthen the dollar and pressure gold.

The Federal Open Market Committee is scheduled to meet on October 27 and 28, according to the Federal Reserve's calendar. Until then, gold may remain sensitive to changes in the dollar, bond yields and expectations for US borrowing costs.

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