Gold Climbs as October Fed Rate Hike Expectations Fade

Gold prices edged higher on Monday, as recent economic data reduced the likelihood of a Federal Reserve rate hike in October, boosting demand for the non-interest-bearing asset. Spot gold rose 0.4 percent to US$4,158.17 per ounce, while US gold futures for December delivery increased 0.6 percent to US$4,186.40.

The shift in market sentiment followed weaker-than-expected US job growth in September, along with downward revisions to previous months' payroll numbers. Tim Waterer, chief market analyst at KCM Trade, noted that the softer labor market data has lowered expectations of an October Fed rate hike, providing some support for gold. However, traders still anticipate an 87 percent chance of a rate increase in December.

Geopolitical tensions also remained a factor influencing gold prices. Yemen's Saudi-backed government announced a major military campaign against Iran-backed Houthis, raising concerns about regional stability and its potential impact on oil prices and inflation. Oil prices slipped slightly due to rising crude exports from the Middle East and releases from G7 nations, despite ongoing conflicts in the Gulf.

Other precious metals saw gains as well, with spot silver rising 1.7 percent to US$61.40 per ounce, platinum up 0.6 percent to US$1,708.48, and palladium firming 0.6 percent to US$1,175.04.