Spot gold and silver climbed during Friday’s afternoon US trading session and retained their weekly gains. Although rebounding US Treasury yields and a stronger US dollar weighed on precious metals, falling oil prices offset part of this pressure, keeping gold and silver relatively strong.
At the close, spot gold stood at $4377.51 per troy ounce, up 0.82% on the day; spot silver was quoted at $66.243 per troy ounce, rising 1.59%. On the charts, precious metals drew most of their support from eASIng inflation pressure brought by lower energy prices, rather than a clear improvement in the interest rate environment.
(Source: FX168)
US Treasury Yields Return to Near 5%
North American stocks closed mixed on Friday, as higher US Treasury yields capped the continuation of Thursday’s rebound. The S&P 500 gained 12.74 points, or 0.2%, to 7650.50. The Dow Jones Industrial Average fell 95.40 points, or 0.2%, to 51682.64. The Nasdaq Composite rose 104.25 points, or 0.4%, to 26522.55. The Russell 2000 dropped 14.23 points, or 0.5%, to 2860.40.
European markets closed broadly lower. The STOXX Europe 600 fell 1.11% to 635.45. The FTSE 100 lost 1.45% to 10659.13. Germany’s DAX declined 1.60% to 25304.06. France’s CAC 40 dropped 1.49% to 8065.02. Italy’s FTSE MIB fell 1.60% to 51545.25. Spain’s IBEX 35 slid 1.60% to 19513.80.
Interest rate markets remain the core pricing variable. The Fed raised the federal funds rate target range by 25 bASIs points this week to 3.75%-4.00%. Futures markets are currently pricing in a 58% probability of another rate hike in October. The 10-year US Treasury yield rebounded to 5.00%, up further from 4.94% late Thursday. The 2-year US Treasury yield hit 4.744% intraday, its highest intraday level since July 2024.
For gold, this combination creates a short-term environment that is “constructive but crowded”: falling oil helps ease the recent inflation shock, yet Fed hike expectations remain strong, and the 10-year yield above 5% continues to cap gold’s upside.
Lower Oil Prices Ease Inflation Fears
The key reason precious metals outperformed amid a tight rate backdrop is that energy prices fell for the third consecutive trading day, partially unwinding the prior oil price shock. Some repricing of geopolitical risk gave precious metals a degree of support.
Spot gold briefly tested the $4400 zone and held above the $4331 pivot zone cited in the latest FXEmpire technical analysis. Spot silver traded above $66, near its first resistance at $66.70. Analysts say gold and silver still need further confirmation to turn the post-FOMC rebound into a clearer technical breakout.
Specifically, gold needs to sustain a break above $4396.15 and firmly hold above $4405.59 to open clearer upside, with the next target at $4466.14. A drop below $4331.34 would bring deeper support levels at $4281.62 and $4235.17. For silver, a steady close above $66.70 would target $68.00 and then $70.00. If silver falls below $64.88, the next downside targets are $63.60 and $62.97.
Strait of Hormuz Remains in Focus
The Strait of Hormuz remains the key geopolitical channel affecting oil prices, inflation expectations and safe-haven demand. Friday’s market reaction reflected a partial pullback in the geopolitical risk premium for crude. Reuters reported that the oil price decline came after China, at Saudi Arabia’s request, urged Iran to rein in Houthi attacks on Saudi oil infrastructure.
Brent crude settled at $104.87 per barrel, down 0.93%. WTI crude closed at $100.30 per barrel, falling 1.58%. Still, shipping traffic through the Strait of Hormuz stayed tight. Only four commodity vessels passed through on Thursday, compared with a 10-day average of around 16. Meanwhile, damage to Saudi Arabia’s east-west pipeline continues to disrupt exports.
For gold, this means the impact remains two-way: lower oil weakens short-term inflation pressure, yet constrained Gulf shipping, risks to Saudi infrastructure and the absence of US-Iran peace talks still provide a defensive floor for gold prices.
External Markets and Technical Levels
In external markets, Nymex WTI crude traded around $100.30/bbl and Brent crude near $104.87/bbl. The benchmark 10-year US Treasury yield stood close to 5.00%, while the US dollar index traded firmly. Market participants are watching the dollar’s impact on gold, as a stronger dollar usually reduces the appeal of dollar-denominated gold.
From a technical perspective, the next target for gold bulls is to retake the $4396.15 resistance. A sustained break would point to $4405.59 and then $4466.14. On the bearish side, a break below $4331.34 would target $4281.62 and $4235.17 in the short run. Silver bulls need to reclaim $66.70 and break above $68.00 to extend gains toward $70.00. If $64.88 is lost, the next downside targets are $63.60 and $62.97.