Gold steadied on Thursday after a sharp sell‑off, with the XAU/USD spot price rising 0.2% to $4,295.5 an ounce at 20:08 ET (00:08 GMT). In the same session silver slipped 0.2% to $64.31 per ounce and the U.S. dollar index was little changed after four consecutive sessions of gains that had taken it to a near two‑month high. Higher Treasury yields and a firm dollar added further pressure on the non‑yielding metal.
Oil prices moved higher after Iranian President Masoud Pezeshkian told the United Nations that Iran would not permit freedom of navigation through the Strait of Hormuz while sanctions and a U.S. blockade remain in place. Pezeshkian said Iran remains willing to negotiate but will not respond to threats, does not seek to build a nuclear weapon, and will not surrender its right to develop nuclear technology for economic purposes. The remarks followed former U.S. President Donald Trump’s statement that U.S. officials had “very good” talks with Iranian envoys on the sidelines of the UN summit.
Gold has fallen roughly 20% since the U.S.–Iran conflict began in late February, with energy prices and the Fed outlook identified as the main drivers. In the United States, the Treasury market faced renewed pressure after stronger‑than‑expected economic data and a weak debt auction, pushing yields across most maturities to their highest levels in almost two decades. The five‑year Treasury yield rose above 5% for the first time since 2007, adding a fresh head‑wind for bullion.
U.S. business activity expanded at its fastest pace in more than five years. Fed Governor Michael Barr indicated that further rate hikes are likely required to bring inflation back to the 2% target, echoing similar warnings from other policymakers. Swap markets are now pricing at least three Fed rate hikes by April 2027, up from earlier expectations.
Despite the near‑term head‑winds, longer‑term demand considerations continue to support gold. However, stronger economic activity, rising oil prices, higher yields and a firmer dollar are keeping the metal under pressure.