Gold Holds Steady Amid Stronger Dollar and Fed Rate Hike Uncertainty
Gold prices held steady on October 6, 2026, as traders balanced the impact of a stronger US dollar and rising Treasury yields against the Federal Reserve’s rate hike prospects. Spot bullion hovered around US$4,140 an ounce, while the US dollar neared its highest level of the year after the euro weakened amid a French bond sell-off.
A stronger dollar typically weighs on gold, a commodity priced in the currency. Meanwhile, longer-dated Treasury yields reached multi-decade peaks as bonds extended their slide. The Institute for Supply Management reported growing cost pressures in US services, the highest in over four years, yet Fed officials have downplayed the chance of an imminent rate hike. Traders currently see roughly a one-in-four chance of a rate increase at the October meeting.
The Fed’s September meeting minutes, where rates were raised for the first time in three years, are set to be released on Wednesday. Higher rates generally hurt gold’s appeal compared to yield-bearing assets like Treasuries. In August, gold fell over 6% on inflation and rate hike concerns, and it has lost more than a fifth of its value since the US-Iran conflict began in late February.
On Tuesday, spot gold was unchanged at US$4,139.06 an ounce in Singapore, while silver held steady at US$61.05 an ounce. Platinum dipped slightly, and palladium saw a modest rise. The Bloomberg Dollar Spot Index remained stable after four weeks of gains.