NEW YORK / RankWire.AI / – Gold reached near a seven-week peak on Thursday, marking its most substantial daily increase since February. Spot gold increased by 0.5% to hit $4,265.22 per ounce by 0330 GMT. During the previous trading session, the metal surged 4.4%. December U.S. gold futures also rose 0.5% to $4,324.60 after a 4% gain on Wednesday. The decline in Treasury yields alongside a softer dollar supported broader gains across the precious metals sector.
Thursday’s rally pushed gold above its 50-day moving average, which sits around $4,160. Until recently, bullion had stayed below this technical indicator amid a recent pullback. The current prices are comparable to levels seen on June 18 and are over 5% higher than Monday’s close. Despite this rally, gold remains below its May highs, when spot prices topped $4,500 an ounce. Nonetheless, the recent uptick has helped recover a significant portion of the losses incurred during June and July.
U.S. Treasury yields decreased as gold prices gained strength. The benchmark 10-year yield hovered around 4.61%, down from roughly 4.74% at the end of July. The two-year yield was near 4.18% on Wednesday. Since gold does not pay interest, lower bond yields diminish the income advantage of government debt over bullion. Meanwhile, the dollar also weakened against major currencies, making gold more affordable for buyers using other currencies.
Bond market adjustments fuel gold’s upward movement
Recent employment data added context to the ongoing economic backdrop influencing market movements. Private sector 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 kept its benchmark interest rate between 3.5% and 3.75%. The broader employment report from the government is still scheduled for release on Friday, covering hiring across both public and private sectors.
Gold had faced consistent downward pressure prior to Wednesday’s sharp rally. Spot prices were near $4,008 on July 20 and approximately $4,052 on August 3. The 4.4% surge on Wednesday marked the metal’s best single-day performance in about six months. Thursday’s gains maintained bullion near the upper part of its recent trading range. Both spot and futures prices stayed significantly above their early-week levels, with trading activity primarily driven by movements in yields and currencies.
Central banks continue to actively purchase gold
Official and institutional buyers continued to influence the overall gold market. The World Gold Council reported that second-quarter demand reached 1,269 metric tons, including over-the-counter activity. This matched demand levels from the same period last year. For the first half of the year, demand increased by 2% to 2,522 tons. Countries such as Poland, Uzbekistan, China, and Kazakhstan were among the largest central-bank purchasers during this timeframe. The rise in average gold prices also boosted the total value of demand during the first six months.
Other precious metals saw mixed performance during Thursday’s session. Silver edged down 0.1% to $62.02 an ounce, while platinum gained 1.2% to $1,755.18. Palladium increased by 0.8% to $1,374.33, marking its third consecutive rise. Gold remained the focal point after Wednesday’s sharp advance. Prices held near a seven-week high as Treasury yields declined and the dollar weakened, extending the rebound that pushed bullion above key recent levels of trading.