Gold remains under pressure near $4,135 as rising US Treasury yields and firmer inflation expectations weigh on bullion ahead of the Federal Reserve’s October meeting.
Gold eased to around $4,135 in early Asian trading on Tuesday as elevated U.S. Treasury yields kept pressure on the metal even after energy prices softened. Traders are still weighing the path for interest rates ahead of the Federal Reserve’s meeting next week, with the benchmark 2-year note yield rising to 4.778%, the 10-year yield climbing to 5.144% and the 30-year yield advancing to 5.476%, according to market data cited by FXStreet. Higher yields tend to work against bullion because gold offers no interest income.
The recent move also reflects a broader bond-market repricing. FXStreet said selling in French government debt after a weekend of violent unrest added to the upward push in global yields, while markets digested last week’s stronger-than-expected U.S. inflation data. Deutsche Bank strategists noted that the data calendar in the U.S. is relatively light this week, leaving investors to reassess the implications of firmer inflation readings and a rise in inflation swaps on both sides of the Atlantic.
Fed policy expectations remain central to the market’s tone. The U.S. central bank increased rates by a quarter point in September, its first hike since 2023, and traders are now trying to judge whether officials will hold rates steady later this month. FXStreet reported that comments from Federal Reserve Chair Kevin Warsh were taken as reinforcing the case for no change in October, while CME FedWatch data show markets pricing in an 82.8% probability that rates will be left unchanged at the October 28 meeting.
Technically, gold remains under pressure. FXStreet said XAU/USD is still trading below its 100-day simple moving average and below the midline of its 20-day Bollinger Bands, a sign that the near-term bias remains bearish. The publication’s chart analysis points to resistance around $4,180, then $4,240, with support near $4,050 if the slide continues. Earlier this month, FXStreet noted that gold had already fallen sharply as higher Treasury yields, a firmer dollar and stronger rate-hike expectations weighed on the metal.
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