Gold prices climbed on Thursday as the U.S. dollar retreated from an 18-month high, allowing bullion to rebound from its lowest point in two months. Spot gold rose 0.5% to $4,132.66 per ounce, while U.S. gold futures for December delivery gained 0.4% to $4,157.60. The dollar's pullback made gold more affordable for international buyers, boosting demand.
Analysts remain cautious about gold's near-term outlook. Chris Weston, head of research at Pepperstone, noted that the short-term investment case for gold is still challenged. He suggested that a break above $4,275 would be needed to shift the market sentiment more positively. Weston also highlighted that if rising long-term bond yields signal credit risks rather than economic strength, gold could regain its appeal as a hedge against inflation.
The Federal Reserve's potential rate hikes continue to weigh on gold. Minutes from the Fed's latest meeting revealed divisions among policymakers, with some favoring a rate increase to control price shocks, while others saw it as a safeguard against demand-driven inflation. Traders currently see an 18% chance of a rate hike later this month but an 80% likelihood in December.
Other precious metals also saw gains. Spot silver rose 0.4% to $60.36, platinum added 1.8% to $1,660.05, and palladium climbed 1.6% to $1,142.00. Meanwhile, IMF Managing Director Kristalina Georgieva warned of global economic threats, including high energy prices and record public debt, urging governments to implement protective fiscal and monetary policies.