Gold climbs back to about $3,895 in early Asian trade, but elevated oil prices and inflation worries keep upside limited.

Gold (XAU/USD) recovered some of Monday’s losses, trading close to $3,895 during the early Asian session after slipping to a session low of $3,870. The rebound came amid a backdrop of stubborn inflation, high oil prices and growing expectations of another U.S. rate hike in December.

Rate‑hike expectations curb further gains

The Federal Reserve left rates unchanged at its October meeting, but the CME FedWatch tool now shows a roughly 73 % probability of a 25‑basis‑point hike in December. Higher rates raise the opportunity cost of holding non‑yielding gold, limiting the metal’s upside despite softer Treasury yields.

Geopolitical and economic headwinds

Tensions in the Middle East have intensified, with Ukraine resuming attacks on Russian oil refineries and Iran’s Supreme Leader ordering preparations for renewed confrontation with the United States and Israel. At the same time, U.S. employment data and the upcoming mid‑term elections add fresh uncertainty to markets.

What traders are watching

• Friday’s Employment Cost Index for the U.S.
• Direction of equity markets, Treasury yields and the USD
• Any shift in Fed messaging that could lower the probability of a December hike

Related news

• Silver price edges higher at $50, eyes next resistance
• China private factory PMI at 52.0 beats forecast, output fastest since April
• Australian dollar softens below 0.7050 on risk‑off mood
• Morning market overview shows mixed cues from oil, China PMI and crypto developments

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This article is compiled from international market news for information only. It is not investment advice.