NEW YORK / RankWire.AI / – Gold remained close to a seven-week high on Thursday, driven by its largest single-day increase since February. Spot gold increased by 0.5% to $4,265.22 an ounce at 0330 GMT, after a 4.4% surge during Wednesday’s trading session. December U.S. gold futures also rose 0.5% to $4,324.60, following a 4% gain the previous day. The notable rise in bullion prices was supported by falling Treasury yields and a weaker dollar.
This upward movement pushed spot gold above its 50-day moving average, which is close to $4,160. Prior to this rally, prices had mostly traded below this level during the recent downturn. Thursday’s increase brought gold prices back to levels last seen on June 18, exceeding Monday’s closing price by more than 5%. Despite this, gold remained below its May peak, when spot prices surpassed $4,500 an ounce amid heightened demand.
Bond markets responded as gold gained momentum, with the benchmark 10-year Treasury yield trading around 4.61%, down from approximately 4.74% at the end of July. Meanwhile, the two-year yield was near 4.18% on Wednesday. These lower yields diminish the income advantage of government bonds, given that gold does not generate interest. Additionally, the dollar weakened against major currencies, making bullion more affordable for buyers holding euros, yen, and other currencies.
Treasury yields decline alongside gold’s rise
U.S. labor market data provided further insights. Private sector employers added 44,000 jobs in July, a decrease from the revised 95,000 increase in June. This July figure represents the smallest monthly gain in half a year. The Federal Reserve maintained its benchmark interest rate between 3.5% and 3.75% at its July 29 meeting. The government’s broader employment report is still scheduled for release on Friday.
Gold’s recent advance partially reversed a decline that extended through June and July. Spot prices dropped near $4,008 on July 20 and hovered around $4,052 on August 3. Wednesday’s 4.4% surge marked the strongest daily performance in roughly six months. Thursday’s increase kept gold near the upper end of its recent trading range, with both spot prices and futures remaining significantly above their levels at the start of the week.
Central bank buying continues to underpin the broader market
Overall demand figures from central banks and investors remained steady. The World Gold Council reported second-quarter demand of 1,269 metric tons, including over-the-counter transactions. This level matched the demand recorded during the same period last year. For the first half of the year, demand rose by 2% to reach 2,522 tons. During this period, Poland, Uzbekistan, China, and Kazakhstan were among the most prominent central-bank buyers.
Other precious metals experienced mixed results on Thursday. Silver declined slightly by 0.1% to $62.02 an ounce. Platinum increased by 1.2% to $1,755.18, while palladium rose by 0.8% to $1,374.33. The move in palladium marked its third consecutive day of gains. After Wednesday’s surge, gold remained the primary focus, with prices holding near a seven-week high amid falling Treasury yields and a weakening U.S. dollar.