Gold edged higher on Wednesday, rising 0.13% to $4,186.15 an ounce, holding onto most of Tuesday’s rebound even as elevated Treasury yields kept a lid on further gains.
Silver moved the other way, falling 0.78% to $60.97, slipping back below the $61 level it had briefly reclaimed a day earlier.
The two metals diverged as oil prices reversed course.
WTI crude rose 2.13% to $91.28 a barrel, while Brent climbed 0.86% to $103.47.
Gasoline gained 3.94%, natural gas fell 0.56%, and heating oil jumped nearly 9%.
Gold also gained after softer-than-expected US inflation data weighed on the dollar.
The personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred measure of inflation, increased 0.3% month-on-month on a seasonally adjusted basis in August, bringing the annual increase to 3.4%.
That marks a turnaround from earlier in the week, when falling oil prices had briefly eased some inflation concerns weighing on the metals.
Yields remain the bigger headwind
With oil now climbing again, Treasury yields stand out as the dominant pressure on bullion this week.
The 30-year US bond yield climbed as high as 5.62% this week, its highest level since June 2002.
The 10-year yield has held near 5.25%.
Concerns over persistent energy-driven inflation, along with hawkish remarks from Federal Reserve officials, have pushed yields higher.
New York Fed President John Williams said Tuesday that another rate increase “late this year” could be appropriate.
He noted that the Middle East conflict and the rapid expansion of artificial intelligence infrastructure remain key drivers of elevated inflation.
Higher yields typically weigh on gold and silver because neither metal pays interest, making them less attractive relative to interest-bearing assets as borrowing costs climb.
Wednesday’s rebound in oil adds a second source of inflation pressure on top of that, working against both metals even as gold managed a small gain.
Energy supply in focus
The US also moved this week to shore up domestic fuel supply.
The Energy Department said Tuesday it would offer to loan up to 40 million barrels from the Strategic Petroleum Reserve, the final portion of a 172-million-barrel drawdown ordered in March as part of an International Energy Agency-coordinated response to the Iran war.
Bids are due by October 6.
A rough month despite the bounce
Both metals remain on track for steep monthly losses.
Gold is on course to end September nearly 6% lower, while silver is set to decline almost 8% for the month, as higher energy costs have contributed to broader pressure on prices throughout September.
Tuesday’s rebound followed a sharp selloff to start the week.
Gold fell more than 4% on Monday to a seven-week low, and silver dropped over 5% the same day.
Both recovered Tuesday after weaker-than-expected US job openings and consumer confidence data cooled some Fed rate-hike expectations.
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