Gold Prices Rebound as Dollar Weakens and Oil Prices Decline

The global gold market staged a significant rebound on Thursday, reaching a nearly one-week high. This rally was driven by multiple factors, including a weaker US dollar and falling oil prices.

Oil prices declined for the second consecutive trading day this week, hitting a one-week low, mainly due to easing market concerns over supply disruptions. Reports indicate that Saudi Arabia will supply more crude oil shipments through Oman, tempering expectations of higher oil prices driven by Middle East tensions.

The US dollar index retreated from its seven-week high, directly lowering the cost for dollar-denominated gold to be purchased by holders of other currencies. This stimulated buying interest and contributed to the rebound in gold prices.

The benchmark 10-year US Treasury yield fell in tandem, closing Thursday at 4.943%, down 6.1 basis points, marking the largest single-day drop in over three weeks. The decline in risk-free yields weakened the opportunity cost of holding gold, further supporting gold prices.