Tag: investing

Silver prices retreat below $57.00 as drone attacks targeting energy infrastructure in the Middle East and Ukraine push oil prices higher, intensifying inflation concerns. Ongoing regional tensions and Iran’s demands for US sanctions relief further increase market uncertainty. Meanwhile, traders expect interest rates to remain unchanged next week, while growing expectations of a potential rate hike in December weigh on non-yielding silver.

Silver prices (XAG/USD) extend their losses for a second consecutive session, trading near $56.80 per troy ounce during Thursday’s Asian session. Rising oil prices are intensifying inflation concerns and strengthening expectations of a potential Federal Reserve rate hike, putting additional pressure on the non-yielding precious metal.

Crude oil prices climbed following a drone attack on Saudi Aramco’s Shaybah oil field that caused two fatalities, heightening geopolitical tensions and concerns over energy supply disruptions. Meanwhile, Ukraine launched large-scale drone strikes against key Russian oil infrastructure this week, potentially hindering Moscow’s plans to expand diesel exports under a recent agreement between US President Donald Trump and Russian President Vladimir Putin.

Geopolitical uncertainty remains elevated as Iranian Foreign Minister Abbas Araghchi called on Washington to lift its naval blockade and demonstrate a genuine commitment to diplomacy. Tehran has indicated its willingness to resume negotiations if the United States provides credible evidence of efforts toward a just and lasting resolution to the conflict.

Rabobank analysts warn that intensifying geopolitical rivalries and shifting supply chains are reinforcing the strategic importance of energy security. With global trade routes and alliances undergoing significant changes, energy markets remain vulnerable to sudden supply disruptions, increasing volatility across oil-related assets.

Meanwhile, investors are closely monitoring the Federal Reserve’s monetary policy outlook ahead of next week’s meeting. Uncertainty persists after Fed Chair Kevin Warsh declined to provide clear guidance on the timing of potential rate increases. According to the CME FedWatch Tool, markets currently assign an 84% probability to the Fed keeping interest rates unchanged next week, while pricing in a 90% chance of a rate hike in December. Expectations of tighter monetary policy could continue to weigh on silver prices by increasing the opportunity cost of holding non-yielding assets.

Treasuries provide interest income, Bitcoin offers a predetermined supply, and cash delivers immediate liquidity. Yet each carries vulnerabilities that gold investors have recognised for centuries.

On 23 September, the US government sought to raise $70 billion through a five-year Treasury note auction. The sale was completed, as expected, but the borrowing cost attracted attention.

The notes were sold at a yield of 5.033%, the highest in approximately two decades and 64 basis points above the comparable auction four weeks earlier. Foreign participation, traditionally an important source of Treasury demand, weakened noticeably. Indirect bidders accounted for just 54.3% of the offering, their smallest share since March 2020, forcing primary dealers to absorb an unusually large proportion of the issuance.

The following afternoon, yields on 30-year Treasuries climbed to 5.501%, their highest level since 2004.

Washington could still access the bond market, but investors were increasingly demanding compensation for lending to the government.

Higher yields would normally strengthen the appeal of government debt. Investors can earn approximately 5% by lending to the US government, an advantage over gold, which generates no income, and Bitcoin, whose returns remain unpredictable.

However, the September auction highlighted a growing contradiction: investors were demanding significantly higher returns to hold an asset widely regarded by financial markets as virtually risk-free.

When Higher Yields Signal Deeper Problems

Government bonds have long occupied a central position in investment portfolios. They provide regular income, substantial liquidity and contractual repayment obligations. During periods of financial stress, investors have traditionally moved away from riskier assets and into US Treasuries, relying on the government’s capacity to meet its obligations.

That confidence has endured through wars, recessions, banking crises and extraordinary experiments in monetary policy.

However, US federal debt has surpassed $40 trillion, while the Congressional Budget Office recorded $963 billion in net interest payments during the first ten months of fiscal 2026. As existing obligations mature, refinancing them at higher rates increases the government’s debt-servicing burden.

This creates a difficult question: how will Washington finance its growing interest expenses?

The government has several options, including raising taxes, cutting spending or issuing additional debt. Each carries economic and political consequences, particularly in an environment where voters have grown accustomed to extensive public spending and government support.

Inflation presents another possibility, albeit a less transparent one.

Government debt is generally repaid in the currency in which it was issued, even if that currency loses purchasing power over time. Bondholders may receive every scheduled interest payment and the full nominal principal while discovering that their money buys considerably less than when they originally invested.

Investors therefore face two distinct risks. Rising yields can push down the market prices of existing bonds, with longer-maturity securities typically experiencing greater sensitivity. Meanwhile, persistent inflation erodes the real value of future interest payments and principal repayments.

A 30-year Treasury purchased in May 2020 was reportedly trading at approximately 45 cents on the dollar in August. The US government had not defaulted, yet the bond’s market value had fallen dramatically.

Higher yields can make gold less appealing when they reflect stronger real returns and confidence in monetary stability. The picture changes when rising yields instead reflect concerns about inflation, deteriorating public finances or an expanding supply of government debt.

Under those circumstances, the additional interest may represent compensation for the very risks investors are attempting to manage.

Who Is Still Financing Washington?

The September auction also highlighted questions about the willingness of traditional foreign creditors to continue absorbing US government debt.

China’s Treasury holdings had declined to approximately $618 billion in July, less than half their November 2013 peak. Japan, America’s largest foreign Treasury holder, had also reduced its exposure as currency pressures and higher domestic yields complicated the appeal of US securities.

For decades, countries accumulating trade surpluses have recycled a portion of their foreign earnings into Treasury securities. This arrangement helped finance US budget deficits while supporting the dollar’s international role.

That relationship, however, is becoming less automatic.

If traditional foreign buyers reduce their purchases, domestic institutions and other investors must absorb a larger share of new issuance. Hedge funds’ long Treasury exposure reportedly increased from approximately $600 billion in 2014 to $2.4 trillion by the end of 2025.

Much of this activity involves leveraged strategies that depend on relatively inexpensive short-term financing. These investors can contribute substantial liquidity under normal conditions, but their positions become more vulnerable when borrowing costs increase or market volatility forces them to reduce exposure.

The Treasury market remains enormous and fundamental to global finance. Nevertheless, growing reliance on leveraged investors introduces an additional vulnerability into a market that serves as the benchmark for pricing risk across the financial system.

Bitcoin’s Unfinished Test as a Store of Value

Dissatisfaction with conventional monetary systems has helped strengthen Bitcoin’s appeal.

Its predetermined supply contrasts with fiat currencies, which central banks can expand through monetary policy. Its decentralised structure also allows users to transfer and hold assets without relying entirely on a central monetary authority.

For investors who witnessed successive rounds of quantitative easing and large-scale monetary expansion, these characteristics offer an alternative to traditional money.

Institutional participation has brought Bitcoin further into mainstream investment portfolios. Exchange-traded funds, professional custodians and established financial institutions have made access easier for a broader range of investors.

Nevertheless, Bitcoin continues to display many characteristics of a speculative asset.

Its price can rise sharply when liquidity is abundant and risk appetite is strong, but it can also suffer substantial declines when financial conditions tighten. More than fifteen years after its introduction, Bitcoin remains sensitive to market positioning, liquidity conditions and investors’ willingness to accept volatility.

For someone protecting retirement savings or setting aside money for a known future expense, an asset capable of losing half its value within months presents an obvious challenge.

Bitcoin’s institutionalisation also introduces an irony. Many investors now gain exposure through the same brokerage platforms, investment funds and custodians that early advocates hoped to avoid.

Direct ownership offers greater independence, but it requires responsible private-key management, secure storage and access to functioning digital infrastructure.

Bitcoin may continue attracting investment and generating exceptional returns. Its scarcity is embedded in the network’s rules, but scarcity alone does not guarantee stable purchasing power or reliable performance when investors need to access their money.

Central banks, for the most part, have remained outside this experiment.

Instead, they have continued accumulating gold.

Cash Provides Liquidity, Not Long-Term Protection

Cash may lack the excitement associated with financial markets, but its practical value becomes particularly apparent during periods of uncertainty.

Households need readily available savings to cover unexpected expenses. Businesses require liquidity to pay wages, rent and operating costs. Investors holding cash can also take advantage of market downturns without being forced to sell longer-term assets at unfavourable prices.

Physical banknotes offer an additional benefit: they can remain usable during internet outages, payment-network disruptions or temporary interruptions to digital banking services.

These are fundamental financial requirements that can be overlooked when investment discussions focus primarily on returns.

However, cash provides no inherent protection against inflation.

Someone holding £10,000 in physical banknotes will still possess £10,000 five years later. If consumer prices rise substantially over that period, the money will purchase less food, energy, housing and transport.

Interest-bearing deposits can offset part of this erosion, but deposit rates fluctuate with monetary policy and may fail to keep pace with inflation after taxes.

Cash earns its place in a portfolio because future spending needs are uncertain. Problems arise when money intended for short-term security becomes the principal vehicle for long-term wealth preservation.

Beyond Dependence on Sovereign Promises

Central banks confront a more complex version of the same challenge. Their reserves must remain accessible and useful across political transitions, changes in monetary policy and periods of international conflict.

The freezing of Russian foreign-exchange reserves in 2022 demonstrated how financial assets held within another country’s jurisdiction can become inaccessible through political decisions.

For governments concerned about their dependence on the US dollar and Western financial infrastructure, the episode offered a significant lesson.

China and other reserve managers consequently have additional reasons to reassess their exposure to foreign sovereign liabilities.

Gold provides a different form of reserve asset because it does not depend on another government promising to repay a debt. Physical bullion held under direct control has no maturity date, cannot be created to finance a fiscal deficit and does not require a particular payment network to remain operational.

That independence does not make gold risk-free. Its market price can decline significantly, storage and security involve costs, and investors receive no interest or dividends while holding it.

Nevertheless, central banks have continued purchasing gold at historically elevated levels.

These institutions have access to deep government bond markets, sophisticated currency-management operations and financial instruments that are unavailable to most individual investors. They understand the opportunity cost of sacrificing interest income.

Their continued accumulation of gold suggests that some governments consider monetary independence, diversification and protection against geopolitical risk valuable enough to justify giving up part of the returns available from conventional reserve assets.

What the Treasury Auction Revealed

The US government retains an extraordinary capacity to borrow. The dollar remains dominant in international trade and finance, while Treasury securities perform essential functions throughout the global banking system.

Claims that the Treasury market is on the verge of disappearing remain difficult to substantiate.

Nevertheless, September’s auction illustrated a less comfortable reality.

Washington sought $70 billion in five-year financing and secured the funds, but at a substantially higher yield than the previous month’s comparable sale. Traditional foreign demand also showed signs of weakening.

Meanwhile, investors face a range of imperfect choices: cash that gradually loses purchasing power, government bonds whose market prices can collapse without a default, and a digital asset whose potential gains come with substantial volatility.

Each serves a legitimate purpose.

Cash provides immediate liquidity. Government bonds offer contractual payments and income. Bitcoin offers exposure to a decentralised digital asset with a predetermined supply.

Gold offers neither interest income nor a maturity date, and its price can stagnate for years while investors wait for its defensive characteristics to become more valuable.

Yet central banks continue adding it to their reserves.

The underlying distinction is straightforward: a financial asset can be liquid, generate income or offer substantial upside without necessarily providing reliable protection against every form of risk.

At September’s auction, the world’s most powerful government discovered that investors wanted greater compensation for holding its promises.

Gold does not depend on such a promise.

That does not guarantee superior returns, but it helps explain why an asset with no yield continues to occupy a place in the reserves of institutions that understand the value of interest income better than almost anyone else.

• WTI prices declined after the US waived sanctions on Russian oil, potentially increasing global supply.
• Intensifying clashes and tanker attacks near the Strait of Hormuz continue to raise concerns over potential supply disruptions.
• Ukrainian drone attacks on Russian oil infrastructure in St. Petersburg add to uncertainty in the global oil market.

West Texas Intermediate (WTI) crude oil fell after seven consecutive sessions of gains, trading at around $97.40 per barrel during Asian trading on Monday. Prices retreated following US President Donald Trump’s decision to suspend key sanctions and tariffs on Russian oil, a move expected to increase Russian fuel exports and ease global supply constraints. The executive order, signed on Friday, temporarily halted restrictions under the Graham Act, which Trump had approved the previous month amid pressure from lawmakers seeking to penalize Moscow for its war in Ukraine. US Secretary of State Marco Rubio said the administration would take up to 60 days to assess the waiver’s economic impact.

Turkey is expected to absorb some of the additional Russian diesel entering global markets under an agreement with Washington. Turkish Energy Minister Alparslan Bayraktar described the arrangement as important for the country’s energy security. Although Turkey remains heavily dependent on energy supplies from Russia, Iran, and Azerbaijan, Ankara continues to pursue diversification through partnerships with the US and other countries.

Despite the initial pullback, WTI prices could regain upward momentum as escalating conflicts in the Middle East and Eastern Europe continue to threaten global oil supplies. In the Middle East, fighting involving Saudi Arabia and Iran-backed Houthi rebels remains intense. A recent Saudi helicopter crash near the Yemeni border and Houthi attacks targeting Yanbu, a major Saudi oil export hub, have heightened concerns over potential disruptions. Meanwhile, three tankers sustained damage in the Strait of Hormuz over the weekend, while Iran’s Islamic Revolutionary Guard Corps (IRGC) Navy reiterated that unauthorized vessels would not be permitted to pass through the strategic waterway.

In Eastern Europe, Ukrainian forces carried out one of their largest aerial operations of the war, launching more than 1,000 drones at targets across Russia. The attacks triggered major fires at an oil export terminal and a storage facility in St. Petersburg on Sunday, adding to uncertainty surrounding Russian oil exports and the broader global energy supply outlook.

• Gold prices edge higher toward $4,175 during early Asian trading on Monday.
• Fed Chair refrained from offering clear signals on an imminent policy shift during remarks at the IMF meetings in Bangkok.
• Geopolitical tensions, particularly developments surrounding US-Iran relations, remain key factors for gold traders to monitor.

Fundamental Analysis

Gold prices (XAU/USD) edge higher to around $4,175 during early Asian trading on Monday, recovering as expectations for further Federal Reserve (Fed) rate hikes begin to fade. Market participants remain focused on geopolitical developments and escalating tensions in the Middle East, which could influence gold’s near-term direction.

Despite stronger-than-expected US inflation data, market expectations for monetary policy have shifted. Fed Chair Kevin Warsh expressed confidence in the resilience of the US economy but refrained from providing clear guidance on the future interest-rate path. Traders largely expect the Fed to maintain rates at its October meeting, while markets are pricing in a 91.8% probability of a rate hike in December, according to the CME FedWatch Tool.

Gerald Gan, chief investment officer at Reed Capital Partners, noted that although inflation remains a concern and further tightening remains possible, Warsh’s latest remarks suggest limited urgency for consecutive rate increases.

Geopolitical developments are also drawing attention. US President Donald Trump reportedly reached a diesel export agreement with Russia and withheld certain sanctions to avoid undermining peace negotiations over Ukraine. Meanwhile, an Iranian official warned that Tehran had prepared a new retaliatory plan in the event of renewed US-Israeli attacks, while maritime authorities reported several incidents involving commercial vessels near the Strait of Hormuz. Continued conflicts in Eastern Europe and the Middle East could intensify concerns about oil-driven inflation, potentially influencing gold prices.

Global bond yields decline as AI growth concerns outweigh inflation pressures

Global bond yields moved lower as concerns over a potential slowdown in artificial intelligence-driven growth overshadowed stronger-than-expected US economic data. Deutsche Bank reported a broad-based rally in government bonds, with the US two-year Treasury yield falling 5.9 basis points to 4.74% and the 10-year yield declining 12.7 basis points to 5.06%. Yields on German Bunds, French OATs and Italian BTPs also retreated.

The bond rally occurred despite a significant upside surprise in US producer price inflation, with headline PPI rising 1.3% in September compared with expectations of 0.6%. The decline in yields suggests that concerns about the economic outlook and AI-related growth prospects are currently outweighing inflationary pressures. Falling US real yields and easing inflation expectations have provided additional support for gold, which tends to benefit from lower yields on non-interest-bearing assets.

Warsh highlights investment and AI demand risks while maintaining policy flexibility

Fed Chair Kevin Warsh struck a cautiously optimistic tone regarding US economic growth and investment, while emphasizing the uncertainty surrounding artificial intelligence’s impact on demand and employment. He identified the October and December policy meetings as important opportunities to assess incoming data on economic output, employment and inflation.

Warsh’s reluctance to commit to a predetermined policy path leaves the door open for further tightening if inflation remains persistent, while suggesting that the Fed is not necessarily prepared to pursue consecutive rate hikes. Although the Fed’s broader policy stance remains hawkish, the absence of a firm commitment to additional tightening has helped ease immediate pressure on gold.

Technical Analysis: Gold remains below key moving averages

Gold continues to face resistance from key technical indicators, keeping the near-term outlook cautious despite its latest recovery. On the daily chart, XAU/USD remains below the 20-period Bollinger Band middle line and the 100-day simple moving average (SMA), indicating that bullish momentum has yet to gain sufficient strength. The Relative Strength Index (RSI) stands at 45.92, reflecting subdued momentum without signaling oversold conditions.

On the downside, initial support is located near the lower Bollinger Band at $4,053.65. A break below this level could expose gold to further selling pressure.

On the upside, a daily close above the middle Bollinger Band at $4,185 would provide an initial signal of stabilization. Further resistance is positioned at the 100-day SMA near $4,240, followed by the upper Bollinger Band around $4,315.

Overall, gold’s recovery remains vulnerable while prices trade below key resistance levels. Easing expectations for aggressive Fed tightening and declining bond yields offer some support, but geopolitical developments, inflation risks and upcoming US economic data are likely to remain the main drivers of price action.

• Houthi strikes targeting Saudi Aramco’s headquarters and Riyadh airport heightened concerns about major disruptions to regional oil supplies.
• Tehran stepped up attacks on tankers transiting the Strait of Hormuz, although US naval operations helped safeguard shipping movements.
• OPEC+ oil output climbed by 900,000 barrels per day in September, fueled largely by a substantial 2 million bpd increase in Saudi Arabia’s production.

West Texas Intermediate (WTI) crude oil extends its rally for a fifth straight session, trading near $94.30 per barrel during Asian trading on Wednesday. Oil prices continue to climb as escalating clashes involving Saudi Arabia and Iran-backed Houthi rebels intensify concerns over potential disruptions to Middle Eastern oil supplies.

Yemen’s Houthi rebels launched a missile strike on Tuesday that hit Saudi Aramco’s headquarters in Dhahran, triggering a fire in part of the facility. The incident followed a rebel attack on Riyadh’s main airport over the weekend and a renewed offensive by a Saudi-led coalition seeking to reclaim territory controlled by the Houthis in Yemen.

Meanwhile, tensions have increased around vital maritime routes as Iran stepped up attacks on oil tankers passing through the Strait of Hormuz. Despite the growing security threats, the United States said its efforts had helped ensure the safe transit of more than 19 million barrels of crude oil through the strategic waterway.

Despite persistent shipping disruptions around the Strait of Hormuz, OPEC+ recorded a significant increase in oil production in September. The alliance, comprising OPEC members and partner producers such as Russia, raised output by approximately 900,000 barrels per day (bpd) from August to an average of 39.07 million bpd, according to OPEC’s monthly report released on Tuesday. Saudi Arabia accounted for much of the increase, reporting production of 8.372 million bpd, more than 2 million bpd above the previous month.

Elsewhere, market participants remained optimistic that a US-Russia agreement concerning diesel exports could potentially release additional Russian supplies into the market. However, the Kremlin rejected any direct connection between the diesel export arrangement and its position on peace negotiations over Ukraine. The statement followed a Reuters report claiming that US representatives had told Ukrainian officials that allowing Russian diesel exports formed part of Washington’s efforts to encourage Moscow to resume negotiations toward a possible peace deal.

Energy markets remain resilient amid rising geopolitical risks

TD Securities noted that strength across the energy sector remains difficult to undermine as tanker attacks intensify. The assessment highlights the oil market’s continued resilience, with geopolitical uncertainty and growing threats to critical shipping routes providing support for crude prices despite the potential for increased production from major oil-producing nations.

• Silver prices remain firm near $61.10 as US President Donald Trump confirms a ceasefire between Russia and Ukraine.
• US 10-year Treasury yields face downward pressure amid declining oil prices.
• Market participants turn their attention to Wednesday’s US Consumer Price Index (CPI) report for fresh clues on inflation and the Federal Reserve’s policy outlook.

Fundamental Analysis

Silver prices (XAG/USD) edge higher to around $61.10 during Asian trading on Monday, maintaining the gains recorded on Friday. The precious metal draws support from falling US Treasury yields as oil prices decline following US President Donald Trump’s announcement of an energy ceasefire between Russia and Ukraine.

At the time of writing, West Texas Intermediate (WTI) crude has fallen 2% to approximately $89.00. Meanwhile, the yield on the 10-year US Treasury note has eased to around 5.24%, retreating from Friday’s peak of 5.36%, its highest level in more than two decades. US bond markets remain closed on Monday in observance of Columbus Day.

Lower Treasury yields generally benefit non-yielding assets such as silver by reducing the opportunity cost of holding precious metals.

Over the weekend, President Trump announced on Truth Social that Russia and Ukraine had agreed to an energy ceasefire, a temporary arrangement under which both sides would halt attacks on energy infrastructure. Ukraine had reportedly intensified strikes against Russian energy facilities in an effort to disrupt Moscow’s funding sources.

“Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine. Both parties have agreed. Do not break it!” Trump stated.

The agreement offers some relief to global markets, which have faced significant energy supply pressures amid escalating tensions in the Middle East.

The announcement followed Trump’s remarks on Friday that he had reached an agreement with Russian President Vladimir Putin for Russia to supply diesel in stages.

Attention is now turning to the US Consumer Price Index (CPI) report for September, scheduled for release on Wednesday. The inflation figures could influence expectations for Federal Reserve monetary policy and shape the near-term direction of silver prices.

Silver Technical Analysis

On the daily chart, XAG/USD trades near $61.02, maintaining a bearish short-term bias as prices remain below the 20-day Exponential Moving Average (EMA) at $62.07. Having pulled back from recent highs, silver continues to trade beneath this key trend indicator, suggesting that recovery attempts may encounter selling pressure.

The Relative Strength Index (RSI) stands at 44, indicating subdued momentum and persistent downside risks, although the metal has not entered oversold territory.

On the upside, the 20-day EMA near $62.07 represents the immediate resistance level. A daily close above this threshold could help ease bearish pressure and create room for a more sustained recovery.

However, if silver fails to reclaim the moving average, the near-term outlook is likely to remain vulnerable, with prices potentially testing previous chart lows. Traders will also monitor Wednesday’s US CPI release for fresh catalysts that could influence market sentiment and price direction.

• Gold prices climb toward $4,215 during early Asian trading on Monday.
• Gold-backed ETF inflows reach their highest level in four years.
• Investors await key US inflation data due this week for fresh market direction.

Fundamental Analysis

Gold (XAU/USD) rises toward $4,215 during early Asian trading on Monday, extending its recovery amid strong inflows into gold-backed exchange-traded funds (ETFs) and a weaker US Dollar (USD).

Gold Gains Support from ETF Inflows and Central Bank Buying

Investment demand for gold continues to strengthen, with inflows into gold-backed ETFs reaching their highest level in four years, according to Bloomberg data. Meanwhile, the People’s Bank of China (PBoC) increased its gold reserves by 740,000 ounces in September, marking its 23rd consecutive month of purchases.

Geopolitical uncertainty also remains in focus. Tensions in the Middle East escalated after a projectile reportedly struck a passenger terminal at King Khalid International Airport in Riyadh on Sunday. The Houthis claimed responsibility, describing the attack as retaliation for what they called Saudi aggression.

US Inflation Reports in Focus as Traders Assess Fed Rate Outlook

Investors are turning their attention to a series of key US economic releases this week for further clues about the Federal Reserve’s (Fed) monetary policy outlook. The Consumer Price Index (CPI) is scheduled for Wednesday, followed by the Producer Price Index (PPI) and Retail Sales figures on Thursday.

Stronger-than-expected inflation could increase the likelihood of further Fed tightening, potentially strengthening the US Dollar and putting pressure on gold prices. Although bullion is widely regarded as an inflation hedge, it does not generate interest income, making it less appealing when interest rates rise.

According to the CME FedWatch tool, markets are pricing in a 17.7% probability of an interest rate hike in October and an 84.1% likelihood of an increase in December.

TD Securities Sees Potential for a Renewed Gold Bull Run

Strategists at TD Securities report that trend-following funds, known as Commodity Trading Advisors (CTAs), are covering short positions across gold and platinum as supportive fundamentals strengthen the precious metals market.

Gold is benefiting from renewed CTA buying, with funds covering short positions equivalent to approximately 7% of their historical maximum position size. Geopolitical risks, fiscal concerns, US Dollar depreciation, de-dollarization and stagflation fears continue to underpin investment demand.

TD Securities believes these factors could eventually allow gold prices to move more independently of real interest rates, potentially laying the groundwork for another bullish phase extending into 2027.

Hawkish Fed Commentary Supports Expectations for Tighter Policy

Federal Reserve official Musalem has reinforced the case for additional monetary tightening, arguing that further policy firming may be necessary to bring inflation back to the 2% target within a reasonable timeframe.

His assessment of a relatively strong economy and a balanced, stable labor market supports the view that interest rates may need to remain elevated. Persistent demand pressures, anchored inflation expectations and structurally higher real yields also point toward a potentially supportive environment for the US Dollar.

Meanwhile, the FXS Fed Sentiment Index declined by 0.25 points to 138.33. Despite the modest drop, the index remains well above its neutral threshold of 100, indicating that the overall policy outlook continues to lean hawkish.

Technical Analysis: Gold Faces Resistance Near $4,225

Gold maintains a mildly bearish near-term technical outlook, trading below the 20-day Bollinger Bands’ middle line and struggling to establish stronger upward momentum. The 14-day Relative Strength Index (RSI) stands at 47.08, slightly below the neutral 50 level.

On the upside, initial resistance is located around $4,225, corresponding to the middle Bollinger Band. A sustained recovery could open the way toward the upper band near $4,400.

On the downside, the 100-day simple moving average (SMA), cited at approximately $4,255, is identified as a broader trend reference, while the lower Bollinger Band near $4,055 represents a potential support area where buying interest could return.

Overall, gold remains supported by robust ETF demand, central bank purchases and geopolitical uncertainty. However, upcoming US inflation data and expectations for further Fed tightening could determine whether the precious metal extends its recovery or faces renewed selling pressure.

Chinese copper smelters ended September effectively paying miners more than $230 per tonne for concentrate. The unusual situation is not necessarily a sign of a copper shortage. Instead, it reflects tightening availability of the silver-bearing ore used by smelters, a development that could be supportive for silver prices.

Normally, a treatment charge is the fee a smelter receives for processing mined ore into refined metal. When that charge turns negative, it means smelters are competing aggressively for available concentrate and are effectively paying miners a premium to secure supplies. Copper concentrate is particularly important to silver investors because it contains silver that can be recovered during the refining process.

This trend is modestly positive for silver over the next year. Mines responsible for more than one-quarter of global silver production are producing less of the type of ore that contains silver. However, the overall impact remains limited. Our estimate suggests the potential silver supply affected represents roughly one-quarter of this year’s projected market deficit, and that estimate declined following the latest July data.

Silver has also faced pressure from higher interest rates. The metal was trading around $61.14 an ounce on October 6, according to USAGOLD’s daily report, while gold stood at $4,156.30. Silver remains roughly half its January peak. The Federal Reserve raised interest rates on September 16 for the first time since 2023, while the 10-year Treasury yield has climbed close to levels last seen in 2002. Although September’s US jobs report showed only 29,000 new jobs, long-term bond yields continued to rise. The situation in copper mining adds another dimension to the silver supply outlook.

What Negative Treatment Charges Reveal

Most mined copper is transported from mines to smelters in the form of concentrate. Chinese smelters account for a significant share of the processing market and convert this material into refined copper.

Under normal conditions, smelters charge miners a treatment fee for processing concentrate. However, data from the Shanghai Metals Market (SMM) show that the fee has moved below zero, meaning smelters are effectively paying miners to secure the ore.

The SMM index reached what the organization described as a record low on September 18. By September 30, the treatment charge had declined even further to minus $231.68 per tonne.

Such deeply negative treatment charges are a strong indication that copper concentrate is in short supply. Smelters are competing with one another for limited quantities of available ore.

Why the Ore Matters for Silver

Copper is generally produced from mines in two main forms. The first is concentrate, which consists of crushed ore that is processed by smelters. This material can contain silver, allowing the metal to be recovered alongside copper. The second is leached cathode, where copper is extracted from rock using acid and then plated directly. Unlike concentrate, this process does not provide silver as a byproduct.

Earlier analysis highlighted how copper producers have increasingly relied on leaching, a process that increases copper production without generating additional silver. The latest International Copper Study Group data through July show the same pattern. Global copper mine production declined by 1%, while concentrate production fell by 2%. At the same time, leached cathode production increased by 3.6%.

Chile, the world’s largest copper producer, has contributed to the decline. Its mining output dropped 11.7% year over year in August. Chile’s national statistics agency attributed the decline partly to falling ore grades at major mines and the impact of severe storms in July.

Labour Disruptions Could Tighten Supply Further

Labour disputes at two major Chilean copper operations could add further pressure to concentrate supplies.

Escondida, the world’s largest copper mine, temporarily suspended operations following the death of a worker during maintenance. The mine began restarting on September 24, according to SMM. However, its supervisors’ union subsequently rejected BHP’s contract proposal and voted in favour of strike action. Under Chilean law, the dispute must first go through a government-led mediation process.

Meanwhile, at Antofagasta’s Centinela mine, 98.73% of union members voted to strike. The union estimated that a legal strike could begin on October 13 if negotiations fail.

Any prolonged disruption at either mine would likely reduce copper concentrate production and could further tighten the supply of silver-bearing ore.

How Much Silver Could Be Affected?

According to Metals Focus and the Silver Institute, copper mines produced approximately 237.3 million ounces of silver in 2025, representing around 28% of global mined silver.

If the 2% decline in copper concentrate production were applied to that silver supply, the implied reduction would be approximately 4.75 million ounces annually.

Lead and zinc mines remain the largest sources of mined silver. Including the previously estimated range for those metals produces a potential impact of roughly 11–12 million ounces. However, these numbers should be viewed as estimates rather than measured reductions in silver production. They are based on the assumption that silver output moves broadly in line with copper, lead and zinc production.

There is also an important counterpoint: refined copper itself remains abundant. Inventories held on major metal exchanges reached their highest level since June 2003 at the end of August. Therefore, the immediate shortage is not a shortage of finished copper but a shortage of the concentrate required by smelters.

What It Means for Silver Investors

Silver is predominantly produced as a byproduct of other metals, and copper mines account for more than one-quarter of global mined silver. As smelters compete aggressively for concentrate and treatment charges move deeply negative, the scarcity of silver-bearing ore becomes increasingly important for the silver market.

The development provides a modestly bullish signal for silver over the next twelve months because mine supply cannot be increased quickly simply because prices rise. However, the impact should not be overstated.

The estimated 11–12 million ounces of potentially affected silver is derived from production data rather than directly measured losses. Furthermore, the estimate decreased after the latest July figures were released. New labour disruptions at Escondida or Centinela could nevertheless increase the potential supply impact.

Metals Focus and the Silver Institute expect the global silver market to record a 46.3 million-ounce deficit this year, marking a potential sixth consecutive year of supply shortfalls. The shortage of copper concentrate will not create that deficit by itself, but it could make it more difficult for silver miners to produce enough additional metal to close the gap.

• Gold remains pressured by high oil prices, rising yields, and a strong US dollar.
• A move back above $4,220–$4,235 would strengthen the short-term outlook for gold.
• Continued central-bank buying provides support for the longer-term bullish outlook.

Fundamental Analysis

Gold prices staged a modest rebound on Monday after coming under renewed selling pressure at the end of last week, even though the latest US employment data came in weaker than expected. The softer jobs figures initially supported gold, but the recovery lost momentum around $4,220 before sellers regained control. While the weaker labour-market data may have reduced expectations for further rate hikes to some extent, it has not fundamentally changed the wider macroeconomic picture.

With inflation still a key concern for the Federal Reserve and elevated oil prices contributing to higher bond yields, gold’s short-term outlook remains vulnerable. However, the longer-term bullish case continues to receive support from strong central-bank demand.

Inflation Remains the Fed’s Main Concern

The disappointing US jobs data have done little to resolve the Federal Reserve’s ongoing inflation challenge. Although signs of weakness in the labour market could increase pressure for lower interest rates, the Fed is unlikely to ease policy aggressively while inflation remains persistently elevated.

A single weak economic indicator can generate a temporary rally in gold without triggering a meaningful shift in the broader monetary-policy outlook. That appears to have been the case following Friday’s employment report. Gold initially attracted buyers, but the rebound stalled at resistance and failed to develop into a sustained reversal.

The US dollar has also remained relatively firm. Rather than extending its post-jobs-report decline, the greenback has regained upward momentum, creating another significant obstacle for gold prices.

Oil Prices Add to the Pressure

High oil prices are complicating the inflation outlook. Rising energy costs could keep inflation elevated for longer while simultaneously putting additional pressure on government bond yields.

This combination is unfavorable for gold in the near term. Higher Treasury yields increase the opportunity cost of holding a non-interest-bearing asset, while a stronger US dollar creates additional downward pressure.

Unless crude oil prices begin to decline substantially, the macroeconomic backdrop is likely to remain challenging for gold.

The next major catalyst will be the US CPI report due on 14 October. A stronger-than-expected inflation reading could strengthen expectations for additional Fed tightening or a prolonged period of restrictive monetary policy. That could support the dollar and push yields higher, creating further headwinds for gold.

On the other hand, a significant downside surprise in inflation could provide gold with some relief.

Technical Outlook: Gold Tests Key Trend Support

From a technical perspective, gold remains exposed to further downside. The metal came close to testing its broader bullish trend line following the jobs report and has since recovered slightly. However, it remains below its short-term bearish trend line and failed to break above resistance around $4,220 on Friday.

A sustained move above the bearish trend line would be an early sign that selling pressure is beginning to fade. More importantly, gold needs to reclaim the $4,220–$4,235 zone to restore a more constructive short-term technical outlook. If that resistance area is decisively broken, the next target could be around $4,280–$4,300.

On the downside, the $4,100–$4,120 region remains the key support area. This zone marked the base of the early-August breakout and was tested several times during last week’s decline.

A decisive break below $4,100 would expose gold to further losses, with limited major support before the psychologically significant $4,000 level. Given the current price structure, a move toward $4,000 later this month remains a possibility.

Central-Bank Buying Supports the Longer-Term Outlook

The bearish short-term setup does not invalidate gold’s longer-term bullish fundamentals. Continued central-bank purchases remain an important source of structural demand. Concerns surrounding fiscal sustainability and the heavy reliance of global reserves on US Treasury assets could encourage further diversification.

A continued shift away from dollar-denominated reserves could therefore provide a longer-term floor for gold and limit the scale of any major correction.

There is also a possibility that prolonged stress in the US bond market could eventually undermine confidence in the country’s fiscal position. If that happens, rising Treasury yields could become negative for the dollar rather than supportive. Investors may increasingly seek alternative stores of value, including gold, silver and Bitcoin.

Neither scenario appears imminent. For now, firm oil prices, elevated yields and a resilient US dollar continue to create a challenging environment for gold in the short term.

Nevertheless, ongoing central-bank accumulation and unresolved concerns over fiscal sustainability keep the longer-term bullish case alive. For now, traders may be better served by focusing on key technical levels and waiting for a clearer directional trend to emerge.

• Silver remains near two-month lows as higher US Treasury yields and a firmer US Dollar continue to pressure the precious metal, overshadowing weaker employment data.
• Renewed geopolitical tensions in the Middle East boosted safe-haven demand for the US Dollar after Houthi attacks in Saudi Arabia.
• Surging inflation in the services sector drove Treasury yields to 24-year highs, even as markets largely expect the Federal Reserve to keep interest rates unchanged.

Silver (XAG/USD) gives back part of its previous session’s gains, trading near $60.70 per troy ounce during Asian trading hours on Tuesday. The precious metal remains close to two-month lows as a stronger US Dollar (USD) and elevated US Treasury yields continue to outweigh supportive economic developments. Although weaker US employment data and reduced expectations of a Federal Reserve rate hike in October have offered some relief, pressure across the broader precious metals market remains elevated.

The US Dollar strengthened further as renewed geopolitical tensions in the Middle East fueled demand for safe-haven assets. According to Xinhua News Agency, Yemen’s Houthi movement claimed responsibility on Monday for coordinated attacks targeting locations in Saudi Arabia, reportedly involving ballistic and cruise missiles as well as drones. Houthi spokesman Yahya Saree said the strikes targeted military installations, an oil facility, and major transport infrastructure, including Riyadh’s King Khalid International Airport. Disruptions to air traffic added to market uncertainty and supported demand for the US Dollar.

Silver also remains under pressure from a sharp rise in US Treasury yields, which climbed to their highest levels in 24 years amid a broad global bond selloff. The move has been driven by growing fiscal concerns and persistent inflation pressures. Recent ISM figures showed that input prices in the US services sector increased at their fastest pace in more than four years last month. Despite markets pricing in roughly a 78% probability that the Federal Reserve will leave interest rates unchanged following weaker labor-market data, higher Treasury yields and a resilient US Dollar continue to weigh on Silver.

G7 Bond Yields Rise as HSBC Points to Sharp Repricing in Long-Dated Debt

HSBC strategists highlighted that G7 bond yields have increased by around 1 percentage point since January, with long-term US Treasury and UK Gilt yields moving well above 5%. The bank characterized the move as a significant repricing across core interest-rate markets, while identifying three competing explanations for the rise. The shift has intensified debate over the factors driving higher real yields and what the move could mean for fixed-income investors.

Fundamental Analysis

Gold futures remained directionless on Friday as markets continued to assess the renewed escalation of the US-Iran conflict, now in its 217th day. At the same time, softer-than-expected US employment data supported expectations that the Federal Reserve may keep interest rates unchanged at its upcoming policy meeting.

Spot gold edged 0.2% higher to $4,187.17 an ounce by 10:01 ET (14:01 GMT), while gold futures gained 0.3% to $4,215.82 an ounce. Despite Friday’s rebound, gold remained on track for a second consecutive weekly decline, with bullion down more than 2% so far this week.

“Gold is stabilizing after a challenging week, receiving some support as Treasury yields decline and the Fed adopts a more cautious stance on interest rates,” said Neil Welsh, Head of Metals at Britannia Global Markets.

Meanwhile, the US Dollar Index, which measures the greenback against a basket of major currencies, slipped 0.2% but remained close to the 17-month high reached during the previous session. The index was heading toward a weekly gain of approximately 1%, increasing the cost of gold for investors holding other currencies.

US Treasury yields also remained elevated. The 10-year Treasury yield briefly climbed to 5.344% on Thursday, its highest level since 2002, before retreating later in the session. On Friday, the benchmark yield stood at 5.234%.

Weak Jobs Data Shifts Fed Rate Expectations

Markets are now closely watching the September Nonfarm Payrolls report, which showed the US economy added just 29,000 jobs, well below expectations of 89,000 and August’s revised figure of 162,000. The unemployment rate also increased to 4.2%, compared with expectations for it to remain at 4.1%.

The disappointing employment figures have become an important factor in shaping expectations for the Federal Reserve’s two-day policy meeting scheduled for October 27–28.

Expectations for another rate increase have weakened considerably in recent days following softer-than-expected inflation data and comments from several Fed officials suggesting that there is limited urgency to raise rates again.

Following the jobs report, markets were pricing in an approximately 84% probability that the Fed would leave interest rates unchanged this month, up from around 76% a day earlier and 36% a week ago. Meanwhile, the probability of another rate hike dropped to roughly 16%, compared with about 64% one week earlier.

A reduced likelihood of further rate increases could provide support for gold by lowering the opportunity cost of holding the non-yielding precious metal.

The Fed raised interest rates by 25 basis points in September as policymakers sought to contain persistent inflationary pressures, which have been exacerbated by geopolitical tensions in the Middle East and heavy investment in artificial intelligence infrastructure.

However, signs of weakening conditions in the labor market could make policymakers more cautious about additional tightening. While higher interest rates can help contain inflation, they can also weigh on economic growth and employment.

Geopolitical Risks Continue to Support the US Dollar

Despite weaker employment data, escalating geopolitical tensions and energy-related inflation risks continue to provide support for the US dollar. With the possibility of an imminent resolution to the US-Iran conflict appearing increasingly remote, investors remain focused on developments in the Middle East.

Speaking on Thursday, US President Donald Trump said he was “ensuring that Iran will be very quickly ended,” while claiming that Iran’s leadership was “ready to fold up.” Trump also said he expected the US to win the conflict “right after the election,” if not before the US midterm elections.

The US military presence in the Middle East is also increasing. The USS Theodore Roosevelt Carrier Strike Group and the USS Makin Island Amphibious Group are reportedly heading toward the region. Their arrival could bring the number of US carrier strike groups in the Middle East to three, alongside approximately 20,000 US personnel.

Separately, the Saudi-led coalition fighting Yemen’s Iran-backed Houthis accused the group of attacking an electricity distribution station in Medina on Thursday. The alleged attack, which occurred in the Saudi city that is home to Islam’s second-holiest site, prompted condemnation from across the Muslim world.

Technical Levels to Watch

Gold Futures – Weekly Chart

On the weekly chart, gold futures opened at $4,315.00, reached a high of $4,315.60 and fell to a low of $4,143.10. The contract was trading around $4,165, indicating persistent selling pressure after retesting the double-top formation established during the final week of August.

The bearish trend could accelerate if the Federal Reserve delivers a 50-basis-point rate hike on October 28.

Even if the Fed decides to keep rates unchanged, gold futures could still revisit the psychological support level around $3,955 during October, particularly as heightened geopolitical tensions continue to create an increasingly uncertain economic environment.

Gold Futures – Daily Chart

On the daily chart, gold futures opened at $4,211.37, climbed to an intraday high of $4,256.50 and dropped to a low of $4,154.15. The contract was trading around $4,167.90, extending a sustained downward trend that began after gold futures reached $4,439.77 on September 18, 2026.

The continued decline highlights the strength of bearish pressure in the market.

A gap-down opening below the key $4,122.54 support level during the first trading session of next week could intensify the downward move and expose gold to further losses.

• WTI declines after the G7 agreed to release 100 million barrels from emergency reserves to alleviate global supply concerns.
• OPEC+ opted to maintain its November production targets unchanged, in line with expectations.
• Regional conflicts continue to disrupt Middle Eastern oil exports, including Houthi control of the Bab el-Mandeb Strait.

West Texas Intermediate (WTI) crude extends its decline for a second consecutive session, trading near $89.30 during Asian trading hours on Monday. Oil prices remain under pressure after G7 countries agreed to release 100 million barrels of crude and diesel from emergency reserves and committed to avoiding energy export restrictions following pressure from US President Donald Trump.

Despite the ongoing regional conflict, Middle Eastern crude exports briefly climbed above pre-war levels in late September, reaching as high as 22.5 million barrels per day, according to Kpler. This compares with an average of around 18 million barrels per day recorded between March 2025 and February 2026.

Oil prices also weakened after OPEC+ agreed to keep November production targets unchanged. The decision was broadly anticipated, with markets expecting further changes to the group’s output policy to be postponed until next year.

Major producers, including Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman, continue to produce below their assigned quotas. Overall exports remain at only around 60%–80% of normal levels amid disruptions caused by the ongoing US-Israel-Iran conflict.

Geopolitical risks remain elevated as Saudi-backed forces in Yemen launched a major offensive against Houthi forces. The escalation followed weeks of rising tensions after the Iran-backed group seized control of the strategically important Bab el-Mandeb Strait. The maritime chokepoint between the Red Sea and Gulf of Aden has served as an alternative route for Saudi oil shipments seeking to bypass the Strait of Hormuz.

Brent declines as supply concerns ease, while Middle East risks remain

Analysts at Rabobank said Brent crude prices retreated last week as improved flows through the Strait of Hormuz and the partial restoration of Saudi Arabia’s East-West pipeline helped ease supply concerns. However, the deployment of another aircraft carrier to the Middle East could threaten the recent improvement, keeping geopolitical risks as a key factor that could limit further declines in oil prices.

• Gold prices edge higher to around $4,160 during early Asian trading on Monday.
• Weaker-than-expected US employment data have increased expectations that the Federal Reserve will leave interest rates unchanged later this month.
• However, concerns over oil-driven inflation could limit further gains in gold prices.

Gold (XAU/USD) extends its recovery to around $4,160 during early Asian trading on Monday. The precious metal finds support as weaker-than-expected US employment data puts pressure on the US Dollar (USD).

Fundamental Analysis

Markets have scaled back expectations for further Federal Reserve (Fed) rate hikes following the latest US jobs report. According to the US Bureau of Labor Statistics (BLS), Nonfarm Payrolls (NFP) increased by just 29K in September, well below the market forecast of 90K. The figure also followed a revised 133K gain in August, down from the previously reported 162K.

The weaker labor market data have prompted investors to reassess the outlook for US monetary policy. The CME FedWatch Tool currently indicates roughly a 22.1% probability of a rate hike this month, sharply lower than the approximately 70% probability seen earlier in the week.

Lower expectations for higher interest rates are generally supportive of gold, as the non-yielding precious metal becomes relatively more attractive when the opportunity cost of holding it declines.

However, gains in gold could remain limited as higher oil prices fuel concerns about renewed inflationary pressures. Ongoing tensions between the United States and Iran have added uncertainty to the outlook for energy markets.

Iranian Foreign Ministry spokesman Esmaeil Baqaei said on Sunday that the Strait of Hormuz remains a central issue in negotiations aimed at ending the conflict with the United States. Parliament speaker Mohammad Bagher Ghalibaf also indicated that Tehran remains firm on its conditions for reopening the strategically important waterway, rejecting what he described as unilateral US demands.

Higher real yields limit gold gains despite softer PCE inflation

Gold has also faced pressure from elevated real yields. Analysts at UOB Group noted that spot gold traded around $4,156 per ounce after reversing an earlier advance that took prices as high as $4,219. The metal ultimately closed 0.6% lower at approximately $4,157 as higher real yields continued to restrict its upside.

US headline PCE inflation increased 0.3% month-on-month in August, matching expectations, while the annual rate eased to 3.4% from 3.7% previously. UOB noted that revisions to the Bureau of Economic Analysis methodology improved the headline picture but did not significantly change the underlying inflation trend.

Hawkish Fed signals support the US Dollar

A more hawkish tone from Fed official Logan has also strengthened expectations for tighter monetary policy and provided support for the US Dollar.

The FXS Speechtracker assigned Logan’s remarks a 9.2/10 score, significantly above the historical average of 8.1/10. Her comments pointed toward a stronger preference for additional tightening, including the possibility of at least another 50 basis points of rate increases.

Logan also suggested that monetary policy may not yet be sufficiently restrictive, while describing economic growth as stronger and the labor market as relatively balanced. Her remarks reinforce the view that the Fed could maintain a restrictive policy stance until inflation moves convincingly toward its 2% target.

The FXS Fed Sentiment Index climbed 1.68 points to 136.59, remaining firmly within hawkish territory. The increase indicates that market perceptions of Fed policy have shifted further toward sustained monetary tightening, supporting a stronger-dollar environment.

Technical Analysis

On the daily chart, XAU/USD maintains a bearish near-term outlook, with prices trading below both the 100-day Simple Moving Average (SMA) and the middle line of the Bollinger Bands.

Gold is currently hovering just above the lower Bollinger Band, suggesting that the recent decline has brought prices close to the lower boundary of the prevailing volatility range. The 14-day Relative Strength Index (RSI) stands at 39.50, remaining in bearish territory but not yet reaching oversold levels. This suggests that downside pressure persists without clear signs of exhaustion.

On the upside, the $4,275 area represents the first major resistance zone, where the Bollinger middle band and 100-day SMA converge. A sustained move above this level could weaken the bearish outlook and expose the next resistance near the upper Bollinger Band at $4,445.

On the downside, immediate support is positioned around $4,102.30, corresponding to the lower Bollinger Band. A decisive break below this level could trigger a deeper correction, while holding above it would leave XAU/USD in a corrective bearish phase within the broader trading range.

• Silver retreats as softer-than-expected August PCE inflation data pushed CME FedWatch expectations for an October rate hike down to around 38%.
• August core PCE inflation increased by just 0.2%, while annual headline inflation eased to 3.4%, below the 3.7% forecast.
• Further upside for Silver may be limited by elevated Treasury yields, higher oil prices, and persistent US-Iran geopolitical tensions.

Silver (XAG/USD) rebounds after declining in the previous session, trading near $60.90 per troy ounce during Asian trading hours on Thursday. The non-yielding metal is finding support as expectations for further Federal Reserve rate hikes have eased following weaker-than-expected US inflation data released on Wednesday.

The CME FedWatch Tool shows that markets are now pricing in around a 38% probability of a Fed rate hike in October, down from approximately 51% before the latest PCE figures. Market attention is now turning to Friday’s US Nonfarm Payrolls (NFP) report, with economists expecting 90,000 new jobs in September and the unemployment rate to hold at 4.1%.

The softer inflation outlook followed the release of August US PCE data. The headline PCE price index increased 0.3%, below the 0.4% forecast, while core PCE rose 0.2%, also missing expectations of 0.3%. On a year-over-year basis, headline PCE inflation slowed to 3.4%, significantly below the 3.7% consensus estimate.

Despite the improved rate outlook, Silver’s upside may remain constrained by broader market pressures. Elevated oil prices and Treasury yields continue to counterbalance the support provided by reduced expectations for Fed tightening. Geopolitical uncertainty also remains elevated, with limited progress in US-Iran negotiations despite signs of a recovery in Middle East oil flows. Investors remain cautious about whether the supply recovery can be sustained without a formal agreement to end the conflict, particularly as Washington and Tehran continue to claim control over the strategic waterway.

US Treasury yields have also risen to multi-decade highs as markets assess the risk that energy-related inflation could remain persistent and encourage tighter monetary policy. The 10-year Treasury yield is holding near 5.298%, while the 30-year yield was last higher by almost 4 basis points at 5.633%.

US data revisions leave Fed tightening bias intact

TD Securities described the latest revisions to US PCE inflation and GDP data as a “mixed bag,” reflecting upward revisions to past growth alongside downward revisions to inflation. However, the firm emphasized that the underlying trend remains more important, arguing that solid economic growth combined with renewed inflation risks is likely to remain central to the Fed’s policy outlook.

Against this backdrop, TD Securities continues to anticipate a Fed rate increase in October, while acknowledging that policymakers could adopt a more gradual approach. The latest data revisions therefore have not materially altered the firm’s broader expectations for the path of monetary policy.

• Middle East crude exports recovered to 17.5 million barrels per day, reaching 98% of pre-war levels.
• US SPR releases of up to 40 million barrels, along with rising inventories, helped ease near-term supply concerns.
• Benchmark oil prices remain on track for monthly gains amid continued disruptions linked to the US-Iran conflict.

WTI Oil Price Edges Higher After Sharp Decline

West Texas Intermediate (WTI) crude oil prices rose modestly to around $88.50 per barrel during Wednesday’s Asian session after falling nearly 4.5% the previous day. The decline came as signs of improving energy flows from the Middle East eased concerns over near-term supply disruptions.

The 10-day average of regional crude exports recovered to 17.5 million barrels per day, equivalent to about 98% of pre-war levels. Saudi Arabia has also resumed crude shipments through its East-West pipeline at roughly half capacity, while oil continues to move through the Strait of Hormuz.

Additional pressure came from the United States’ plans to release up to 40 million barrels from its Strategic Petroleum Reserve (SPR). Rising US crude inventories, which reportedly increased by around 1 million barrels last week, also contributed to softer oil prices.

Despite the recent pullback, WTI remains on track for a third consecutive monthly gain, supported by ongoing disruptions linked to the prolonged US-Iran conflict.

US-Iran Tensions Keep Oil Markets in Focus

Geopolitical developments remain a key driver of crude oil prices. Scotiabank strategists said the market continues to focus heavily on oil, citing renewed deterioration in US-Iran negotiations and President Trump’s rejection of an Iranian proposal concerning the reopening of the Strait of Hormuz.

These developments continue to add uncertainty to global energy supplies and provide support for oil prices despite the recent improvement in Middle East exports.

• Gold buyers remain cautious as markets price in at least one Fed rate cut by year-end.
• Falling US Treasury yields weigh on the USD, pulling it lower from a two-month high and providing support for gold.
• Traders await the US PCE inflation data for fresh direction ahead of Friday’s key US Nonfarm Payrolls report.

Gold (XAU/USD) is struggling to extend the previous session’s gains, moving sideways during Wednesday’s Asian trading session after rebounding from around $4,100, its lowest level since August 5. The downside remains relatively supported as falling US Treasury yields have pushed the US Dollar lower from a two-month high, providing some support for non-yielding gold. Traders are also likely to remain cautious ahead of several key US economic releases that could provide fresh direction.

The main focus today is the US Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred inflation measure, along with the final Q2 GDP reading. Markets will also watch the US ISM Manufacturing PMI on Thursday and the highly anticipated Nonfarm Payrolls (NFP) report on Friday. Comments from FOMC officials could further influence expectations for the Fed’s policy path, with potential implications for both the USD and gold prices.

US Data and Fed Expectations Keep the Dollar Supported

OCBC strategists highlight the US labor market report as the key event risk for markets this week. Current consensus expectations point to September payroll growth of around 90,000, down from 162,000 in August, while the unemployment rate is expected to remain at 4.1%. Although Fed Chair Kevin Warsh has highlighted initial jobless claims as a timely indicator of labor-market conditions, payroll growth remains one of the market’s primary gauges of employment health.

OCBC maintains its view that the USD could strengthen moderately toward the end of the year. However, the bank argues that current market pricing for almost four Fed rate hikes over the next 12 months appears aggressive unless demand-driven inflation becomes the dominant source of price pressures. Wage growth and rental inflation will therefore remain important indicators for future Fed policy expectations.

Meanwhile, US Treasury yields have eased from recent highs following a decline in crude oil prices and dovish remarks from New York Fed President John Williams, who suggested that the central bank does not need to rush its next policy move. The weaker-than-expected US Consumer Confidence Index, which fell to 81.9 in September, its lowest level since 2014, also contributed to some USD profit-taking and offered additional support to gold.

Despite these developments, markets continue to price a high probability of another Fed rate hike before the end of the year. Ongoing geopolitical tensions surrounding the US-Iran situation could also maintain demand for the safe-haven USD, limiting the upside potential for XAU/USD.

Expectations for a diplomatic resolution have weakened after US President Donald Trump rejected Iran’s proposal for a seven-day ceasefire. Meanwhile, Qatar’s attempts to facilitate negotiations between Washington and Tehran have made limited progress. Reports that the US could potentially resume major military operations after the midterm elections have further kept geopolitical risks elevated.

Given these uncertainties, traders may prefer to wait for stronger buying momentum before concluding that gold has established a firm bottom near $4,100.

XAU/USD Technical Outlook

Gold continues to find support around $4,100, which corresponds to the 78.6% Fibonacci retracement of the June-August advance. However, the MACD remains in negative territory, indicating that bearish pressure has not fully disappeared, while the RSI near 40 points to weak momentum rather than oversold conditions.

On the upside, the $4,227 area, corresponding to the 61.8% Fibonacci retracement, represents the first significant resistance. A move above this level could bring the 200-day EMA near $4,307 and the mid-range Fibonacci level around $4,317 into focus.

Further gains could encounter resistance around $4,406, representing the 38.2% retracement, followed by $4,517 at the 23.6% level.

On the downside, $4,100 remains the immediate support zone. A sustained break below this level could expose the previous swing low around $3,937 and increase the risk of a deeper correction toward that area.

• Silver comes under pressure as higher oil prices fuel inflation concerns and strengthen expectations of additional Federal Reserve rate hikes.
• Rising oil prices, driven by stalled US-Iran nuclear negotiations, are also contributing to upward pressure on multi-year-high US Treasury yields.
• Markets are pricing in a 70% probability of an October rate hike, with investors awaiting key PCE inflation and US payrolls data for further clues on the Fed’s policy path.

Silver (XAG/USD) remains under pressure after falling more than 5% in the previous session, trading near $60.60 per troy ounce during Asian trading hours on Tuesday. The non-yielding precious metal continues to face selling pressure as uncertainty over US-Iran negotiations keeps oil prices elevated. Persistently high energy costs are raising concerns about inflation and increasing expectations that the Federal Reserve may need to maintain a tighter monetary policy stance.

Oil prices resumed their advance after Iranian officials cast doubt on the possibility of reaching a deal before the US midterm elections in November. The latest impasse came after US President Donald Trump rejected Tehran’s most recent proposal, slowing progress in diplomatic negotiations.

Higher inflation expectations and the prospect of further Fed rate hikes have pushed US Treasury yields to fresh multi-year highs, weighing on assets that do not offer interest income, including Silver. After the central bank delivered its first rate hike in three years earlier this month, money markets are now pricing in around a 70% probability of another increase in October.

OIS Curve Signals Expectations for Further Fed Tightening

Rabobank strategists noted that positioning in US interest-rate markets remains strongly tilted toward additional monetary tightening. According to the bank, the OIS curve indicates that investors continue to price in more than three Fed hikes through the end of next year. This suggests that, despite the Fed’s recent 25-basis-point rate increase, markets still expect the tightening cycle to continue for an extended period.

Investors will now turn their attention to upcoming US economic data for further clues about the Fed’s policy direction. Key releases scheduled for later this week include Wednesday’s Personal Consumption Expenditures (PCE) inflation report and Friday’s Nonfarm Payrolls data.

Gold miners have rarely been in a stronger financial position. Yet the large deposits needed to replace the ounces they extract are becoming increasingly difficult to discover.

In the early 1960s, geologists working in Nevada began finding gold in places miners had spent generations overlooking. The metal was not always concentrated in obvious, high-grade veins. In some cases, microscopic particles of gold were dispersed throughout enormous volumes of rock that appeared almost worthless to the naked eye.

Those discoveries eventually became the Carlin Trend, one of the most important gold-producing regions of the modern mining industry. Mines were developed, further deposits were discovered, and over time Nevada became synonymous with large-scale gold production.

For roughly six decades, the mining industry has been searching for another discovery on a similar scale.

Gold prices have risen at an extraordinary pace. Levels that once would have marked the peak of a commodity cycle are now being incorporated into mine plans and resource assessments. Mining companies are generating substantial margins, but that raises a more difficult question: where can they invest the money when the number of truly large gold assets available to acquire or develop continues to shrink?

Higher gold prices can extend the operating lives of existing mines, make lower-grade ore economically viable and transform previously marginal deposits into potential development projects.

What higher prices cannot do is create new geology.

The Ounces Have to Come From Somewhere

Every producing gold mine begins losing inventory as soon as operations start.

Ore is extracted, processed and sold, while reserves gradually decline. Mining companies can replenish those ounces by drilling around existing operations, converting resources into reserves or acquiring deposits from other companies. For major producers, acquisitions are increasingly becoming the quickest way to secure additional resources.

S&P Global considers discoveries containing more than two million ounces of gold to be major discoveries. By that definition, there were no major discoveries in either 2023 or 2024. Only six were recorded between 2020 and 2024, and the average size of discoveries during that five-year period was smaller than in the preceding decade.

That does not mean the world is running out of gold. The problem is the shortage of large, newly discovered deposits capable of making a meaningful difference to the reserves of major mining companies.

The acquisition market provides another indication of this trend.

Gold Fields acquired full ownership of Windfall in Quebec. Northern Star Resources bought De Grey and its 13-million-ounce Hemi system. Agnico Eagle has continued consolidating gold assets around its existing operations in Finland.

The strategy is relatively simple: when high-quality ounces cannot be discovered quickly enough, mining companies can purchase deposits that have already been identified.

The industry has plenty of capital.

What it lacks is new inventory.

Four Million Ounces Before the Next Hole

One potentially significant resource already identified is located in southern Ecuador.

Auro Metals acquired the Santa Barbara gold-copper project earlier this year. Its March 2026 resource estimate outlined 697,000 ounces of indicated gold and another 3.418 million ounces of inferred gold. In total, more than four million ounces of gold resources have been identified, together with nearly 494 million pounds of copper.

The estimate was based on approximately 22,000 metres of historical drilling from 56 diamond drill holes. The mineralised system extends more than 1.2 kilometres from north to south, about 600 metres from east to west and reaches at least 900 metres below surface. Mineralisation remains open both laterally and at depth.

Auro has since completed an additional 11,047 metres of drilling through its Phase I programme, covering 22 holes. Results from 17 holes have been released, while five remain pending.

The programme was primarily designed to fill gaps between historical drill holes, increase drilling density within inferred resources and obtain fresh core for metallurgical testing ahead of a future resource update.

Having more than four million resource ounces does not automatically make Santa Barbara a mine. Most of the existing inventory remains classified as inferred, the project has not yet established mineral reserves, and its engineering requirements, metallurgy and economic viability still need to be demonstrated.

However, Auro’s exploration strategy is moving beyond simply confirming the existing resource. The next phase of drilling is increasingly focused on determining where the Santa Barbara system ends.

The Boundaries Start Moving

Recent Phase I assay results provide some indication of why the company is expanding its exploration programme.

Hole DSB-68 was drilled into Santa Barbara South, currently regarded as the core of the known porphyry system. It intersected 905.22 metres grading 0.60 g/t gold and 0.12% copper, beginning only 56.5 metres below surface. The hole ultimately reached a depth of 1,282 metres, making it the deepest hole drilled at Santa Barbara to date.

Importantly, weaker mineralisation continued to the bottom of the hole.

That could prove more significant than the headline intercept itself. The hole ended because of the drilling rig’s technical limitations rather than because Auro had definitively reached the bottom of the mineralised system.

Two nearby holes provided additional evidence of the system’s potential extent.

DSB-69 returned two mineralised intervals, including 200.55 metres grading 0.59 g/t gold and 0.08% copper. Within that interval was a higher-grade section of 57.83 metres at 1.06 g/t gold.

DSB-70 intersected 262.5 metres grading 0.71 g/t gold and 0.10% copper from near surface, including 100.45 metres at 1.01 g/t gold.

Together, the results pointed to continued mineralisation down dip in DSB-69 and a deeper, higher-grade zone in DSB-70.

Auro has now moved directly into Phase II drilling.

The company plans to drill another 20,000 metres, with three additional rigs capable of drilling beyond 1,000 metres being brought onto the project. The focus is shifting from predominantly infill drilling toward testing gaps between known mineralised areas, stepping out toward new targets and following the system to greater depths.

A Phase III programme is expected to continue with additional step-out and resource-expansion drilling.

The objective of Phase II is therefore broader than simply confirming Santa Barbara’s current resource. Auro is now testing how far the mineralised system extends beyond the ounces already identified.

When Geology Becomes Inventory

A gold price of $4,500 can make many mining challenges easier to manage, but it cannot eliminate them.

A mining company with billions of dollars in cash can purchase another deposit. It cannot manufacture a new one. Ultimately, geology determines how much additional gold can be found.

Santa Barbara’s current resource remains constrained within a conceptual pit shell and does not yet establish economic viability. A significant portion of the resource is still classified as inferred.

At the same time, major producers are generating substantial amounts of cash just as the pipeline of large discoveries becomes increasingly limited.

The early discoveries in Nevada eventually revealed a gold system far larger than the miners at Carlin could initially see. Each additional drill hole helped redefine the boundaries of a geological system that would support mining operations for generations.

Santa Barbara already contains more than four million ounces of gold resources. Following another 11,000 metres of drilling, important parts of its boundaries remain unresolved.

Auro’s next task is to determine where those boundaries lie.

• WTI prices decline as Qatari-mediated US-Iran talks raise hopes that the Strait of Hormuz could be reopened.
• Iran called for an end to the blockade, while the White House said there was limited pressure to reach a deal despite ongoing diplomatic contacts.
• Oil prices could recover after Saudi Arabia intercepted six Houthi ballistic missiles aimed at major cities across the region.

WTI crude oil prices retreated after two consecutive sessions of gains, trading near $92.60 a barrel during Friday’s Asian session. The decline came as reports indicated that the US and Iran were exploring a phased agreement aimed at reopening the Strait of Hormuz and ending the US blockade on Iranian ports. Qatari officials were reportedly mediating the discussions on the sidelines of the United Nations General Assembly.

Despite the diplomatic efforts, both sides continued to maintain firm positions. Iran insisted on keeping control of the Strait of Hormuz and said any agreement would require the US to reduce military pressure and remove the port blockade. Meanwhile, a White House official said President Donald Trump remained willing to engage in talks but believed Washington had limited incentive to negotiate given its strong position following the sanctions campaign.

Still, rising tensions in the Middle East could provide support for oil prices. Iran-aligned Houthi militants in Yemen recently launched missiles toward Saudi cities, including Yanbu and Taif. The Saudi-led coalition said Saudi Arabia successfully intercepted six ballistic missiles.

US energy surplus helps shield manufacturers from Hormuz risks

ING analysts warned that restrictions on shipping through the Strait of Hormuz could increase concerns over energy shortages, higher prices, and potential disruptions to global manufacturing. However, they noted that the US may be better positioned than European and Asian economies to withstand these pressures because it produces more energy than it consumes, providing a buffer against supply disruptions and international price increases.

• Gold prices edged lower to around $4,275 during early Asian trading on Friday.
• A renewed surge in oil prices fueled inflation concerns, reducing the attractiveness of gold.
• Hawkish remarks from Federal Reserve officials reinforced expectations of further interest rate hikes.

Gold (XAU/USD) edged lower to around $4,275 during Friday’s Asian trading session, extending recent losses as investors increasingly anticipate additional Federal Reserve interest rate hikes later this year. Market participants are also awaiting remarks from New York Fed President John Williams and Cleveland Fed President Beth Hammack later in the day.

Meanwhile, crude oil prices recovered after U.S.-Iran discussions failed to produce meaningful progress, reigniting concerns that higher energy costs could fuel inflation. At the same time, yields on long-term U.S. Treasury bonds climbed to their highest levels in more than twenty years. Rising oil prices and elevated bond yields have reinforced expectations that the Fed may need to maintain a tighter monetary policy stance to keep inflation under control.

According to the CME FedWatch Tool, markets currently assign a 67.5% probability to a 25-basis-point rate increase in October, up from 55.4% a week earlier. Higher interest rates generally create headwinds for gold, as the non-yielding asset becomes less attractive compared with interest-bearing investments.

Fed officials continued to deliver hawkish messages throughout the week. Cleveland Fed President Beth Hammack warned that inflation remains persistently elevated and could become increasingly difficult to bring back to target if pressures continue. Likewise, Philadelphia Fed President Anna Paulson emphasized that inflation still requires attention and suggested that additional rate hikes may be necessary.

Strong Chinese Demand Continues to Support Gold Market

Despite recent price weakness, analysts at Commerzbank highlight robust physical demand from China as a major pillar supporting the gold market in 2026. Customs data shows China imported more than 1,000 tonnes of gold during the first eight months of the year, already surpassing total imports recorded in the previous year.

Official purchases have further strengthened demand. The People’s Bank of China reportedly added more than 80 tonnes of gold between January and August, with buying accelerating in recent months and reaching the highest monthly level in nearly three years during August. As a result, China remains one of the most significant drivers of global gold demand this year.

Paulson Signals Openness to Further Tightening

Anna Paulson’s latest comments reflected a distinctly hawkish tone, indicating that the Fed could still raise rates again if inflation remains stubbornly above target. She noted that the September rate increase improved the Fed’s ability to combat inflation but suggested that underlying price pressures remain elevated, partly supported by investment linked to artificial intelligence expansion.

At the same time, Paulson acknowledged that the U.S. economy and labor market remain resilient, reinforcing the Fed’s focus on containing inflation risks rather than responding to economic weakness. The unchanged FXS Fed Sentiment Index at 148.18 also suggests that overall Fed communication continues to favor a restrictive policy stance, supporting expectations for higher rates and a stronger U.S. dollar.

Technical Outlook: Gold Faces Resistance Below 100-Day Moving Average

From a technical perspective, gold maintains a bearish near-term outlook while trading below both the 100-day moving average and the middle Bollinger Band on the daily chart. Although prices remain above the lower Bollinger Band, leaving room for a short-term rebound, the Relative Strength Index (RSI) near 44 indicates that downside momentum remains dominant without entering oversold territory.

Key resistance is located near the 100-day moving average around $4,310, followed by the Bollinger midpoint near $4,360. A stronger barrier sits around $4,480 at the upper Bollinger Band. On the downside, immediate support is seen near $4,240 at the lower Bollinger Band, with a break below this level potentially triggering a deeper correction toward lower support zones.

The Treasury purchased $5.2 billion of its own long-dated bonds but failed to prevent yields from moving higher. A week later, the Federal Reserve raised interest rates, yet silver continued to climb. Both moves point to the same underlying rule.

Silver in 2026 appears to be responding more closely to long-term interest rates and the oil prices that influence them than to the size of the fiscal deficit. When long-term yields rise, silver tends to weaken regardless of Treasury intervention. When yields decline, silver can recover even during a week when the Fed raises rates. The past week provided a clear example, with the metal responding within days as yields eased.

This also challenges the idea that a widening deficit automatically supports silver prices. The fiscal deficit deteriorated during September while silver declined, before the metal recovered as bond yields moved lower. The next major test could come in early November, when the Treasury’s current round of expanded buybacks is scheduled to end.

Silver was trading at around $65.38 an ounce early on September 22, compared with gold at $4,322.95, putting the gold-silver ratio at approximately 66.1. Silver was 4.5% higher than its September 16 level, the day the Federal Reserve increased its policy rate by 25 basis points to a range of 3.75%–4.00%. Fed projections pointed to one additional rate increase before the end of the year.

Despite the recent rebound, silver remained about 8% below its level at the start of 2026 and roughly 46% below its January peak of $121.58. The move following the Fed decision coincided with the 10-year Treasury yield falling back below 5% while oil prices also eased. Brent crude declined from above $105 toward $104 as reports indicated that Saudi Arabia was working to restore its East-West pipeline.

The Treasury Bought $5.2 Billion of Long Bonds, Yet Yields Still Rose

The previous analysis proposed that silver might respond less to fiscal stress itself and more to how policymakers respond to that stress.

The theory was straightforward. If the Treasury or Federal Reserve intervenes to keep borrowing costs lower, investors could interpret that action as monetary financing of the deficit, potentially supporting demand for silver as a hedge against currency debasement.

August appeared to support that idea. On August 19, the Treasury announced plans to at least double the size of its buybacks of long-term government bonds. Through these operations, the Treasury repurchases its own debt from dealers. Following the announcement, the 30-year Treasury yield declined, while silver gained 14.9% during August based on Sprott Money’s series.

The first major test came on September 10. The Treasury conducted the first enlarged buyback, targeting bonds maturing in 10 to 20 years. The operation had a $6.0 billion maximum and resulted in $5.2 billion of purchases.

Despite the larger-than-before operation, long-term yields continued to rise. The 30-year yield had fallen to 5.196% when the expanded buyback program was announced, but climbed to 5.353% by September 14. Meanwhile, the 10-year yield briefly reached 5% for the first time since 2023. Silver declined 4.8% over the two-week period.

Importantly, the fiscal situation had not improved. The August Monthly Treasury Statement showed the federal deficit reaching $1.966 trillion during the first 11 months of the fiscal year, while interest payments on the national debt surpassed $1 trillion for the first time.

Instead, the key changes came from inflation and energy prices. A stronger-than-expected jobs report was released on September 4, followed a week later by hotter-than-expected core inflation. Together, those developments increased expectations of a September rate increase.

The 2-year Treasury yield, which is particularly sensitive to expectations for Federal Reserve policy, climbed by roughly 30 basis points. At the same time, Brent crude rose from around $95 to above $105 after Saudi Arabia shut its main export pipeline. Higher oil prices increased concerns about future inflation, while the resulting shift in rate expectations weighed on silver.

Why the Treasury Buybacks Could Not Hold Yields Down

Two details help put the Treasury’s buyback operation into perspective.

First, dealers offered $10.5 billion of bonds against the $6 billion purchase limit. That was less than twice the available capacity. Earlier in the year, smaller operations had reportedly attracted offers close to ten times their respective limits. As the Treasury increased the size of the program, the amount of bonds offered did not increase proportionally.

Second, the Treasury’s stated objective for expanding the program was to support liquidity and trading conditions in a segment of the bond market where dealers already play an important role. It was not presented as a response to a collapse in demand for long-term government bonds.

The mechanics of the program also explain why it has limited power to suppress yields when the Fed is moving toward tighter policy. The Treasury finances its bond purchases by issuing additional short-term Treasury bills, meaning the overall national debt does not decline. Instead, its maturity profile shifts toward shorter-term debt.

The Federal Reserve does not purchase the bonds through this operation. Its separate purchases of Treasury bills for managing bank reserves had remained at zero since mid-August. As a result, the Treasury operation does not represent a direct injection of new money into the financial system. It is essentially an exchange of longer-term debt for shorter-term debt conducted by the Treasury.

The bond market appears to have treated it accordingly.

What Happened After the Fed’s Rate Decision

The Federal Reserve raised rates on September 16 and signaled another increase before year-end. Yet silver moved higher.

Rather than contradicting the earlier argument, the move fits the same framework. Oil prices declined as reports emerged of progress involving the Saudi pipeline and renewed discussions with Gulf states. Lower energy prices reduced some inflation concerns, helping push bond yields lower.

The 10-year Treasury yield, which had been above 5% the previous week, fell back toward 4.93% by September 18. Silver moved higher at the same time.

This distinction is important: silver rose even though the Fed’s policy rate increased because longer-term yields were moving in the opposite direction. In other words, the metal appeared to be responding more closely to the bond market’s expectations than to the Fed’s headline policy rate.

The Next Test for Silver

One important variable has yet to provide a definitive answer. The 30-year Treasury yield, at around 5.29%, remained above the 5.196% level recorded when the Treasury announced its expanded buybacks in August.

The Treasury’s current series of enlarged operations is scheduled to continue through November 4. By then, there should be enough additional observations to assess whether long-term yields respond meaningfully to Treasury buying or remain primarily driven by Federal Reserve policy, inflation expectations and other market forces.

If long-term yields remain above their August level while silver fails to respond, the earlier debasement argument would require significant qualification. Conversely, if yields decline during the buyback period and silver rises alongside them, the August relationship would receive further support.

The key condition is whether Treasury intervention can influence long-term borrowing costs when Federal Reserve policy is moving in the opposite direction.

What This Means for Silver Investors

Silver may respond to fiscal stress when markets believe that the stress is being financed through monetary expansion or policies that suppress long-term borrowing costs. That perception was more plausible while the Federal Reserve was holding rates steady and Treasury buybacks were pushing long-term yields lower.

Once the Fed began tightening, short-term rates adjusted first and the bond market continued to determine long-term borrowing costs. The Treasury’s buybacks therefore had limited ability to offset the broader shift in rate expectations.

The latest move in silver highlights the other side of the relationship. When long-term yields decline, whether because of lower oil prices, changing inflation expectations or other factors, silver can rise even while the Federal Reserve is raising its policy rate.

For silver investors, this provides a potentially simpler framework for interpreting short-term price movements. Long-term Treasury yields and oil prices may offer more immediate clues than the headline size of the federal deficit.

That does not eliminate the longer-term debate over fiscal deficits and potential currency debasement. Instead, September’s price action suggests that the market may process that fiscal story through the bond market first. Long-term yields respond to changing inflation and policy expectations, and silver then reacts to those changes.

The next significant test will come from the Treasury’s expanded buyback program. By the time the current series ends in early November, there should be more evidence on whether long-term yields respond to Treasury demand or remain primarily influenced by broader monetary-policy and market forces.

• Gold price rebounds to around $4,360 during Wednesday’s early Asian trading session.
• Trump said US officials held a “very good” meeting with Iranian representatives in New York.
• Expectations that interest rates could remain elevated for longer may weigh on Gold prices.

Gold (XAU/USD) rebounds to around $4,360 during Wednesday’s early Asian trading session, supported by renewed hopes of diplomatic progress between the United States and Iran.

CNBC reported on Tuesday that US President Donald Trump said American officials held a “very good meeting” with an Iranian delegation in New York, with the talks lasting around three hours. Iran has also reportedly offered to reopen the Strait of Hormuz within seven days, although CNBC noted that the report has not been independently confirmed. Meanwhile, Saudi Arabia is reportedly considering restarting its East-West pipeline as early as this week.

Despite the positive geopolitical developments, Gold could face headwinds from a hawkish Federal Reserve (Fed). The US central bank raised interest rates by 25 basis points last week and indicated that further rate increases could be needed. St. Louis Fed President Alberto Musalem said the Fed may need to raise rates further to contain inflation driven by strong demand and a broader commodity price shock. He also argued that acting sooner could be preferable to waiting.

Higher interest rates generally put pressure on Gold because the non-yielding precious metal becomes less attractive compared with interest-bearing assets.

China Remains a Major Driver of Gold Demand

Commerzbank analysts point to China’s increasingly important role in the global Gold market this year. Customs data showed that China imported more than 1,000 tons of Gold during the first eight months of the year, already surpassing the total imported throughout the previous year.

China’s central bank has also increased its Gold purchases, acquiring around 80 tons between January and August. Buying activity has accelerated in recent months, reaching its highest level in almost three years in August. Commerzbank therefore identifies China as one of the key drivers of Gold demand this year.

Technical Analysis: Gold Holds Above the 100-Day SMA

On the daily chart, XAU/USD remains above the 100-day simple moving average (SMA), keeping the near-term outlook constructive as the price approaches the middle Bollinger Band. This level represents the first significant resistance, while the upper Bollinger Band provides a further barrier to the upside.

The 14-day Relative Strength Index (RSI) is around 50, indicating neutral momentum. This suggests that Gold’s next direction could depend largely on how price reacts around the nearby Bollinger Band levels.

On the downside, the 100-day SMA around $4,315 offers immediate support, while the lower Bollinger Band near $4,215 could provide a stronger floor if selling pressure increases.

On the upside, resistance is seen around $4,390 at the middle Bollinger Band, followed by the upper band near $4,565. A sustained move above $4,390 could strengthen the recovery toward $4,565, while a break below the 100-day SMA would weaken the near-term bullish setup and expose the $4,215 region.

• WTI extends losses, sliding toward $89.00 during Wednesday’s Asian trading session.
• Trump stated he remains in a “deciding mode” regarding the next steps in the Iran conflict.
• US crude stockpiles increased by 1.786 million barrels in the week ending September 18, according to the API.

West Texas Intermediate (WTI), the US crude oil benchmark, trades near $89.00 during Wednesday’s early Asian session. The decline comes after US President Donald Trump revealed that Washington held several hours of discussions with Iran.

According to CNBC, Trump said US officials met with an Iranian delegation for three hours on the sidelines of the United Nations General Assembly in New York. Trump described the meeting as “very good.”

Earlier on Tuesday, Trump said he faced a “big decision” over whether to pursue a diplomatic agreement with Iran or continue applying pressure on Tehran. He warned of severe consequences if no agreement is reached to end the conflict, while also indicating that a deal could potentially emerge soon as diplomatic efforts intensify at the UN.

Geopolitical risks remain in focus after the Houthis targeted Riyadh and the Red Sea port of Yanbu on Saturday. Saudi authorities said their defenses intercepted a ballistic missile aimed at Riyadh and prevented the attack on Yanbu from causing damage.

Meanwhile, US crude inventories unexpectedly increased last week. The American Petroleum Institute (API) reported that crude stockpiles rose by 1.786 million barrels in the week ended September 18, following a 7.14-million-barrel increase in the previous week. The figure also contrasted with market expectations for a 500,000-barrel draw.

Oil market watches renewed Saudi supply risks

OCBC analysts see potential for renewed support in crude prices following the latest attacks targeting Saudi Arabia. The Houthis claimed missile and drone strikes against Riyadh and an Aramco facility in Yanbu, while Saudi authorities said the attacks on Yanbu and other locations were successfully thwarted. No fresh damage to oil infrastructure or disruption to production has been reported so far.

Technical Analysis: WTI maintains a constructive outlook above the 100-day SMA

On the daily chart, WTI retains a constructive near-term bias as prices remain comfortably above the 100-day simple moving average (SMA) and the lower Bollinger Band. This suggests that the broader uptrend remains intact despite the recent pullback from cycle highs. However, the middle Bollinger Band provides immediate resistance, while the RSI at 47.42 points to weakening upside momentum rather than deeply oversold conditions.

On the upside, resistance is seen around the middle Bollinger Band at $92.10, followed by the upper Bollinger Band near $102.40. On the downside, $89.10 represents the first key support and short-term pivot. A break lower could expose the 100-day SMA near $85.00, followed by the lower Bollinger Band around $81.75, where buying interest could emerge and help maintain the broader uptrend.

• Silver regains upward momentum but remains within the broader trading range established the previous day.
• The mixed technical signals suggest caution before expecting another leg higher.
• A clear move above the 23.6% Fibonacci resistance is required to strengthen the outlook for further near-term gains.

Silver (XAG/USD) attracts renewed buying interest after experiencing two-way price action in the previous session, rising nearly 0.50% to trade around $66.40–$66.45 during Tuesday’s Asian session. Despite the recovery, the precious metal remains below last week’s swing high near $67.25–$67.30, suggesting that bullish traders should remain cautious.

The $67.25–$67.30 area corresponds to the 23.6% Fibonacci retracement of the July–August advance and represents an important technical level. Meanwhile, XAG/USD is holding slightly above the 100-day simple moving average (SMA) at $66.32, keeping the near-term outlook modestly positive. Further support is provided by lower Fibonacci retracement levels, particularly the 38.2% level at $64.87 and the 50% level at $62.93, creating a layered support zone beneath the recent price move.

The Relative Strength Index (RSI), currently around 54, also points to a balanced yet constructive market tone. The indicator remains in neutral territory, suggesting that silver is neither overbought nor oversold as it consolidates above the key moving average. However, the Moving Average Convergence Divergence (MACD) remains slightly negative, indicating that upward momentum may be losing strength. A sustained move above $67.27 would therefore be important to confirm further upside potential.

If silver breaks above this resistance, the next significant target could be the previous cycle high near $71.14. Conversely, failure to overcome this level could leave XAG/USD trading within a broader range, supported by its Fibonacci and moving average structure. On the downside, the 100-day SMA at $66.32 provides immediate support, followed by the 38.2% Fibonacci retracement at $64.87 and the 50% level at $62.93 if selling pressure increases.

• Gold prices fell to around $4,365 during early Asian trading on Monday.
• Iran issued a warning after reportedly receiving information that the US could resume military action.
• Fed’s Schmid backed a rate hike as inflation spreads more broadly above 3%.

Gold (XAU/USD) edged lower to around $4,365 during early Asian trading on Monday as the precious metal came under pressure from renewed Middle East tensions and hawkish comments from Federal Reserve officials. Investors are now looking ahead to further Fed commentary later this week for fresh signals on the US interest-rate outlook.

According to Reuters, governments across the Middle East are preparing for a possible escalation after Iran said it had received intelligence indicating that Washington was considering a renewed bombing campaign against the Islamic Republic. While geopolitical tensions can traditionally support safe-haven demand for gold, concerns that a conflict-driven rise in oil prices could fuel inflation may limit the upside for the precious metal.

The Federal Reserve raised its benchmark interest rate by 25 basis points last week to a range of 3.75%-4.0% and signaled that additional increases could be considered in the coming months. Markets currently price in a 56.5% probability of another rate hike at the Fed’s October meeting, according to the CME FedWatch Tool. Higher interest rates generally weigh on gold because the non-yielding asset becomes less attractive compared with interest-bearing investments.

Hawkish remarks from Fed policymakers are also keeping a lid on gold’s gains. Kansas City Fed President Jeffrey Schmid said Friday that he supported the latest rate increase, pointing to recent data showing inflation running above 3%.

Meanwhile, Minneapolis Fed President Neel Kashkari said Sunday that inflation in the US remains elevated across several parts of the economy and cannot be attributed solely to higher energy and oil prices.

Gold Remains Under Pressure From Yields and the US Dollar

OCBC strategists noted that elevated Treasury yields and a stronger US Dollar could continue to restrict gold’s near-term gains, with the Fed’s latest decision adding to the pressure created by higher interest rates and a firmer dollar.

However, the bank maintained that the current environment does not necessarily weaken gold’s medium-term outlook. With markets already pricing in a relatively hawkish Fed path, weaker-than-expected US economic data could push Treasury yields and the Dollar lower, potentially providing renewed support for gold.

Schmid’s Hawkish Stance Reinforces Higher-for-Longer Rate Expectations

Fed Governor Schmid delivered a notably hawkish message, emphasizing that recent data indicate inflation is running above 3%. He argued that the latest rate increase represents another step toward bringing inflation back toward the Fed’s 2% target.

His comments also highlighted that price pressures remain widespread across various goods and services rather than being limited to energy costs. Schmid pointed to an imbalance between supply and demand while noting that the broader economy and labor market remain relatively solid. This combination could strengthen expectations that interest rates may remain elevated for longer and provide continued support for the US Dollar.

The FXS Fed Sentiment Index also remained firmly in hawkish territory, rising 0.42 points to 152.09. The move suggests that Schmid’s comments added further tightening pressure to expectations surrounding Fed policy. A sustained hawkish stance could reduce expectations for near-term rate cuts while maintaining a supportive backdrop for the Dollar against major currencies such as the Euro and Japanese Yen.

Technical Analysis: Gold Holds Above the 100-Day SMA

On the daily chart, XAU/USD maintains a constructive technical structure while trading above its 100-day simple moving average (SMA). However, the price remains below the middle Bollinger Band, indicating that the market is currently consolidating rather than extending a strong directional move.

The Relative Strength Index (RSI) stands at 51.13, close to neutral levels and showing a slight bullish bias. This suggests that momentum remains balanced, with neither buyers nor sellers showing clear dominance.

On the upside, the Bollinger middle band around $4,410 represents the first significant resistance level. A daily close above this area could expose the upper Bollinger Band near $4,615.

On the downside, the 100-day SMA around $4,320 provides the first major support level. If selling pressure intensifies, the lower Bollinger Band near $4,200 could offer additional support. As long as gold remains above these key technical levels, the broader bullish structure remains in place.

WTI Crude Oil continues to trade near the psychologically important $100 level, reflecting a market caught between geopolitical uncertainty and underlying supply-demand fundamentals. While traders have largely adjusted to the steady flow of Middle East-related headlines, concerns remain elevated over any developments that could disrupt oil production or transportation.

With the new trading week approaching, market participants are focused primarily on short-term risks rather than longer-term outlooks. This shift in attention has helped support higher price levels, as investors remain cautious about the potential for sudden changes in geopolitical conditions.

The Significance of the $100 Threshold

The $100 mark has become a critical reference point for both institutional and retail traders. Sentiment around this level is likely to influence the next directional move, particularly as fresh geopolitical developments emerge.

Market participants are closely monitoring whether tensions in the Middle East could escalate further and threaten energy exports. After briefly testing the $107 region last week, WTI remains capable of sharp moves in either direction, with volatility expected to stay elevated as traders react to incoming news.

Supply Concerns Continue to Support Prices

The market’s primary focus remains the risk of supply disruptions. Reports suggesting diplomatic discussions between Iran and the United States have offered some optimism, but ongoing military activity in the region continues to create uncertainty.

Investors betting on lower oil prices should recognize that traders may remain skeptical until tangible progress is made toward reducing tensions. As a result, support levels could remain resilient even if positive headlines emerge.

Downside Moves May Face Strong Support

Although recent price surges may create opportunities for bearish traders, volatility remains a significant challenge. WTI has been prone to abrupt reversals as conflicting headlines frequently alter market sentiment.

Any decline driven by improving geopolitical conditions could be limited if traders continue to doubt the durability of diplomatic solutions. Consequently, downside momentum may struggle to gain traction without clear evidence of reduced supply risks.

Volatility Expected to Remain High

Caution remains warranted in the crude oil market. Current price action suggests that major market participants are positioning for the possibility of worsening geopolitical developments while also hoping for a diplomatic resolution.

For now, WTI Crude Oil remains highly sensitive to Middle East headlines, with the $100 area serving as the key near-term pivot. Supply and shipping concerns could continue to support prices, while meaningful signs of easing tensions may encourage a pullback.

Key Technical Levels

• Resistance: $101.00
• Support: $99.80
• Upside Target: $106.10
• Downside Target: $97.00

Overall, WTI crude oil remains in a volatile environment where geopolitical developments are likely to remain the dominant driver of price action in the near term.

• Gold price drops to around $4,265 in early Asian trading on Thursday.
• The Fed raised its benchmark interest rate by 25 basis points to a target range of 3.75%–4.00% on Wednesday.
• Trump called for the Fed to cut interest rates to 1% “or less” following the rate decision.

Fundamental Analysis

Gold price (XAU/USD) comes under renewed selling pressure, trading around $4,265 during early Asian hours on Thursday. The precious metal extends its decline after the US Federal Reserve (Fed) raised interest rates and indicated that another hike could be possible later this year.

The Federal Open Market Committee (FOMC) unanimously voted on Wednesday to raise the benchmark federal funds rate by 25 basis points to a target range of 3.75%–4.00%. The move marked the Fed’s first rate increase since July 2023.

During the press conference, Fed Chair Kevin Warsh reiterated concerns about persistent inflation, noting that price increases across several goods and services categories remained above 3% on both six- and 12-month annualized measures. His comments pointed to the possibility of additional rate increases in the months ahead, supporting the US Dollar (USD) and putting further pressure on non-yielding Gold.

Higher interest rates generally weigh on Gold because the precious metal does not generate interest income, making yield-bearing assets comparatively more attractive.

Meanwhile, US President Donald Trump called on the Fed to cut interest rates to 1% “or less” on Wednesday, shortly after the central bank announced its first rate hike since 2023. Continued tensions between the White House and the independent Fed could support safe-haven demand and potentially limit Gold’s downside.

Gold’s Safe-Haven Support Offset by Higher Yields and a Stronger Dollar

Commerzbank analysts note that Gold’s recent pullback toward $4,292 reflects a balance between geopolitical safe-haven demand and unfavorable macroeconomic factors. According to the bank, rising Treasury yields and a stronger US Dollar continue to offset some of the support generated by geopolitical risks, limiting Gold’s ability to benefit fully from risk-off flows.

The bank also points to India’s inflation environment as a factor behind firm precious-metal prices, particularly elevated inflation in Gold and Silver jewelry, while underlying core inflation excluding precious metals remains considerably softer.

Technical Analysis: Gold Remains Below the 100-Day SMA

On the daily chart, XAU/USD remains below the 100-day Moving Average (MA) and the 20-period Simple Moving Average (SMA) of the Bollinger Bands. This keeps the near-term outlook tilted to the downside, although momentum remains moderate. The 14-day Relative Strength Index (RSI) is around 42, indicating continued bearish pressure without signaling extreme selling conditions.

On the upside, the 100-day MA near $4,325 represents the first resistance level. The Bollinger midline around $4,440 provides another barrier, while the upper band near $4,685 marks a more distant resistance zone. A sustained move above these levels would help ease the current bearish pressure.

On the downside, the lower Bollinger Band around $4,200 represents the next significant support area, where buyers could emerge if selling pressure intensifies.

• Oil prices ease as Saudi Arabia moves to partially resume operations on its East-West pipeline in the coming days and targets a full recovery within six weeks.
• The reopening of shipping routes, aided by US military support, allowed 18 million barrels of crude and petroleum products to transit the Strait of Hormuz.
• US crude stockpiles decreased by 640,000 barrels last week, missing expectations for a much larger 1.62 million-barrel drawdown.

WTI crude oil continues to retreat for a second consecutive session, trading near $96.60 per barrel during Thursday’s Asian session. Oil prices came under pressure after reports indicated that Saudi Arabia intends to restore around half of the capacity of its East-West pipeline within days, with full operations expected to resume within six weeks. The pipeline, a key alternative export route that bypasses the Strait of Hormuz, was damaged in recent drone attacks.

Saudi Arabia has also increased crude shipments through the Strait of Hormuz with support from the US military, helping to alleviate supply concerns. US Energy Secretary Chris Wright stated that roughly 18 million barrels of crude and refined petroleum products successfully transited the strategic waterway earlier this week.

Additional downside pressure emerged after the US Energy Information Administration (EIA) reported a smaller-than-forecast decline in crude inventories. US stockpiles fell by about 640,000 barrels last week, far below analysts’ expectations for a 1.62 million-barrel draw, suggesting supply conditions remain more comfortable than previously anticipated.

Geopolitical Risks Continue to Support Oil Prices

Despite the recent pullback, geopolitical tensions in the Middle East continue to provide underlying support for crude prices. Analysts at TD Securities noted that the extent of US military involvement in the region remains a key factor for the energy market. The firm suggested that a reduced American military presence could keep geopolitical risk premiums elevated, as Iran may seek to strengthen its influence over the Strait of Hormuz, sustaining concerns about potential disruptions to global oil supplies.