NEW YORK / RankWire.AI / – Gold hovered near a seven-week peak on Thursday following its most significant daily increase since February. The spot price of gold rose by 0.5% to $4,265.22 an ounce by 0330 GMT. This came after a 4.4% surge during Wednesday’s trading session. Additionally, December U.S. gold futures gained 0.5% to $4,324.60 after climbing 4% the previous day. The rally was supported by declining Treasury yields and a weakened dollar, which contributed to the rally in gold prices.
The upward movement pushed the spot gold price above its 50-day moving average of approximately $4,160, a level it traded below during most of the recent downturn. Thursday’s gains brought gold prices back to levels last seen on June 18, with the metal trading more than 5% above Monday’s closing price. Although it remains below its peak in May when spot prices surpassed $4,500 an ounce amid increased demand, it has made notable progress.
As gold gained momentum, bond markets responded accordingly. The benchmark 10-year Treasury yield was near 4.61%, down from roughly 4.74% at the end of July. Meanwhile, the two-year yield was around 4.18% on Wednesday. Diminished yields lessen the appeal of government debt since gold does not generate interest, while the dollar also softened against major currencies, making gold more affordable for buyers using euros, yen, and other currencies.
Gold rally coincides with declining Treasury yields
U.S. employment data added new insights to the market outlook. In July, private sector employers added 44,000 jobs, compared to a revised 95,000 increase in June. This marked the smallest monthly job growth in six months. The Federal Reserve maintained its benchmark interest rate between 3.5% and 3.75% at its July 29 meeting. The government’s broader employment report remains scheduled for release on Friday.
Gold’s recent rise reversed part of the decline seen through June and July. Spot prices dipped to nearly $4,008 on July 20 and traded around $4,052 on August 3. Wednesday’s 4.4% jump was the most substantial single-day increase in about six months, and Thursday’s gain kept gold near the top of its recent trading range. Both spot prices and futures stayed significantly above their levels at the beginning of the week.
Central bank purchasing supports broader market strength
Demand figures from the World Gold Council indicated steady buying activity from central banks and investors. The organization reported a demand of 1,269 metric tons during the second quarter, including over-the-counter transactions, matching 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 leading central bank buyers during this period.
Thursday’s trading also saw mixed results for other precious metals. Silver dipped 0.1% to $62.02 an ounce. Platinum rose 1.2% to $1,755.18, while palladium increased 0.8% to $1,374.33, marking its third consecutive day of gains. Gold remained the focal point after Wednesday’s surge, with prices holding near a seven-week high amid falling Treasury yields and a weakening U.S. dollar.