NEW YORK / RankWire.AI / – Gold edged higher in Asian trading Wednesday as U.S. Treasury yields eased from recent highs. Spot gold rose 0.2% to $4,342.33 an ounce at 0030 GMT after falling nearly 2% on Tuesday. December U.S. gold futures slipped 0.6% to $4,396.30 an ounce. The rebound kept interest-rate expectations at the center of bullion trading. The Federal Reserve scheduled minutes from its July policy meeting for release at 1800 GMT Wednesday.
Gold had reversed lower on Tuesday after two sessions of gains. Spot bullion fell 1.1% to $4,364.90 an ounce by 1733 GMT. December futures settled 1.2% lower at $4,420.60. A global bond selloff pushed long-term borrowing costs in several major economies toward levels not seen in decades. The U.S. 30-year Treasury yield reached 5.3371% on Tuesday, its highest level in nearly 20 years, before easing to about 5.28% during Asian trading Wednesday.
Interest-rate markets continued to show reduced expectations for a September increase. CME FedWatch data showed a 65% probability that policymakers would keep rates unchanged next month. Traders assigned a 35% probability to a quarter-point increase. Lower expected rates generally support gold because bullion pays no interest. Recent U.S. data also showed unexpected employment losses, milder inflation and weaker July retail spending, which had reduced market pricing for an immediate rate increase.
Fed minutes put policy divide in focus
The Federal Reserve held its federal funds target range at 3.50% to 3.75% on July 29. The Federal Open Market Committee approved that decision by a 9-3 vote. Beth Hammack, Neel Kashkari and Lorie Logan preferred a quarter-point increase. The committee said economic activity was expanding at a solid pace despite elevated uncertainty. It also said inflation remained above its 2% goal, partly because supply shocks had raised prices in sectors including energy. Job gains had kept pace with the workforce, while unemployment changed little.
Those divisions placed added attention on the July meeting record. Chairman Kevin Warsh led the meeting, his second policy gathering as Fed chair. The July statement said the central bank would continue maintaining ample reserves in the banking system. The next scheduled policy meeting runs from Sept. 15 to Sept. 16. Officials will again set the target range after reviewing economic and financial conditions under the central bank’s monetary policy framework.
Bond yields remain central to gold trading
Treasury yields remained a key influence on precious metals after Tuesday’s sharp move. Higher yields raise the opportunity cost of holding gold, which does not produce interest income. Oil prices also remained elevated, adding another inflation-sensitive factor to markets. Other precious metals traded mixed early Wednesday. Spot silver fell 0.5% to $62.99 an ounce, while platinum gained 0.3% to $1,717.03. Palladium slipped 0.3% to $1,286.73, extending the uneven performance across the precious-metals complex.
Gold entered Wednesday after a volatile August that followed a largely unchanged July. Global gold exchange-traded funds recorded $3 billion in net inflows during July, according to the World Gold Council. Total holdings increased by 23 metric tons to 4,068 tons, while assets under management rose 1% to $530 billion. Wednesday’s early rebound recovered only a small part of Tuesday’s decline. Rate expectations, Treasury yields and U.S. monetary policy remained central measures across the gold market.