Gold Prices Rebound Ahead of Fed Decision Amid Falling Treasury Yields

Gold prices are rising as traders await the Federal Reserve's decision this week. The rebound in gold comes despite the stronger U.S. dollar, which gained ground against a broad basket of currencies following a better-than-expected Retail Sales report.

The pullback in Treasury yields has also contributed to gold's gains, with the yield of 2-year Treasuries declining towards the 4.61% level and the yield of 10-year Treasuries pulling back towards 4.95%. Analysts and traders expect a 25-bps rate hike by the Fed to combat inflation triggered by high oil prices.

If the Fed is less hawkish than expected, gold prices are likely to rally. Some traders believe this scenario is possible, leading them to buy gold ahead of the Fed's decision.