Gold prices saw a modest rebound on Thursday, snapping a two-month low as the U.S. dollar retreated from its highest level in 18 months. The shift in the dollar's strength provided some relief to bullion, which had dipped to its lowest point since early August amid broader market pressures.
Spot gold rose by 0.5%, reaching $4,132.66 per ounce by early trading hours. The decline in gold prices earlier in the week was driven by a stronger dollar and rising U.S. Treasury yields, which typically make gold less attractive to investors holding other currencies.
Traders are now closely watching the Federal Reserve's next moves, with speculation mounting over whether another interest rate hike could occur before the end of the year. The Fed's monetary policy decisions remain a key factor influencing gold's performance, as higher rates often dampen demand for non-yielding assets like bullion.