Gold Defies Treasury Yield Spike as Oil Prices Weigh on Markets
The 10-year Treasury yield has reached its highest level since 2007, climbing to 5.02% on September 15, 2026.
Despite this increase, gold held steady near $4,278 an ounce and silver remained flat at around $63.26.
This is unusual because a rise in the Treasury yield typically makes bonds more attractive relative to precious metals, as they offer a higher interest rate compared to bullion.
The mechanism behind this is simple: gold pays no interest, so when the 10-year Treasury yield rises, a bond becomes more appealing due to its increased earning potential.
However, oil prices are complicating the picture for investors. Crude climbed towards $103 a barrel on WTI and near $107 on Brent after Houthi forces took control of the Bab al-Mandeb shipping chokepoint and Saudi Arabia's East-West pipeline remained shut due to drone damage.
This Middle Eastern supply shock should normally send investors towards gold and silver for wealth preservation, but instead, traders are viewing it as an inflation problem for the Federal Reserve to solve.