Gold market rebounds as softer oil eases inflation concerns

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Gold rebounds as oil eases inflation

Highlights

Spot gold rises 0.7% to $3,900.90 an ounce by 0440 GMT, rebounding after a 3.5% drop below $4,000 in the previous session.
Oil prices fall more than 3% amid ongoing Iran-Qatar conflict talks, easing inflation concerns and supporting precious metals prices.
Traders price in a 73% chance of a Fed rate hike in December as officials signal more tightening, maintaining pressure on gold's near-term outlook.

Price moves and drivers in early trading

As reported by Reuters, spot gold rises 0.7% to $3,900.90 an ounce by 0440 GMT after touching a one-year low in the previous session, while U.S. gold futures for December delivery gain 0.3% to $3,909.70.

Bullion slumped 3.5% on Friday to its lowest level since October 2025, dropping below the key $4,000 an ounce mark as a selloff in technology stocks triggered forced selling of safe-haven assets and margin calls. Kyle Rodda, senior financial market analyst at Capital.com, says the market is seeing a bounce after that retreat, with weaker oil prices offering some relief to precious metals.

Oil prices fall more than 3% after Reuters reports that Iranian negotiators are in Doha on Sunday for a third straight day of talks with Qatari mediators aimed at securing a deal to end the U.S.-Israeli war on Iran. Lower energy prices can reduce concern that inflation will stay elevated, a factor that tends to support demand for gold.

Fed outlook keeps pressure on bullion

Higher energy prices often reinforce expectations that the Federal Reserve will keep interest rates elevated for longer, raising the opportunity cost of holding non-yielding assets such as gold. That link remains central for investors assessing whether the metal's rebound can last.

Meanwhile, three Fed officials argued on Friday for further rate increases to tackle still-high inflation, in the first round of public comments after last week's policy meeting left short-term borrowing costs unchanged. Traders are pricing in about a 73% chance of a rate hike in December, according to CME's FedWatch Tool.

Ole Hansen, head of commodity strategy at Saxo Bank, says gold faces a difficult near-term backdrop as technical selling and liquidity concerns overshadow its longer-term investment appeal. Elsewhere in precious metals, spot silver climbs 1.8% to $49.97, platinum adds 0.1% to $1,432.63 and palladium is steady at $976.31.

In our earlier article on the Nasdaq-100 (NDX) selloff, we explained that the index slid under short- and medium-term moving averages as downside risk stayed elevated despite mixed momentum signals. We also noted the launch of Janus Henderson and Centrifuge’s blockchain-native JQQQ fund as a longer-term structural development for institutional access, even as near-term trading remained range-bound and vulnerable to further declines.

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