Gold (XAU/USD) price steadies on Monday after reaching a daily low beneath $4,500, as the US Dollar is on the back foot amid fears that the energy shock spurred by the Middle East conflict could trigger a second wave of inflation.
Consequently, global bond yields—which are falling in the day—remain near their highest levels of the year
XAU/USD stabilizes as softer Dollar offsets elevated Treasury yields The XAU/USD pair trades at $4,541 flat, while the US Dollar Index (DXY), which measures the buck’s performance against a basket of six currencies, drops 0.20% to 99.06. Sentiment remains mixed, with US equities swinging between positive/negative in the day. The US 10-year Treasury note yield rose to its highest level in nearly two years, at 4.631%, before turning flat at 4.595%, a tailwind for Gold prices.
Money markets had begun to price in a 50% chance that the Federal Reserve (Fed) will raise rates in December 2026, rather than ease policy, according to Prime Terminal data. Over the weekend, US President Donald Trump said the clock is ticking for Iran, while Bloomberg reported that Washington agreed to lift sanctions on Iranian Oil during the negotiation period, pushing West Texas Intermediate (WTI) prices lower. Consequently, the Greenback turned negative on the day due to its positive correlation with Oil prices.