Gold Steadies Near $4,400 as Yields Ease Before Fed Minutes

Gold prices have stabilized near $4,400 per ounce as Treasury yields eased and the dollar weakened. The 30-year U.S. Treasury yield dropped by 0.025 percentage point to 5.284%, snapping a two-trading-day streak of rising yields.

The partial recovery in gold prices came as investors held their positions ahead of the Federal Reserve's July meeting minutes, which are set to reveal the central bank's rate path. The Fed minutes will be crucial for gold markets, as they could impact the direction of interest rates and subsequently influence gold prices.

Harvinder Kalirai, chief global fixed income and currency strategist at Alpine Macro, notes that if the Fed does not follow through with the rate hikes currently priced into markets, yields could fall further, weakening the dollar and lifting gold. Softer U.S. economic data has already begun shifting rate expectations, which has pushed gold above $4,400 in recent sessions.

Central bank buying is also providing a structural floor for gold prices, with spot gold trading near $4,423 per ounce and up approximately 1.1% on the day at the time of reporting. However, rising oil prices are introducing a competing pressure on gold prices, as they tend to increase inflationary pressures and push yields higher.