On October 21, COMEX gold stabilized during intraday trading, with its price center edging slightly higher to close at $4,159.5 per ounce, up 0.41%. In the domestic night session, SHFE gold opened higher and traded in a range, closing at 892.60 yuan per gram, up 0.29%. The simultaneous decline in the dollar and U.S. Treasury yields served as the direct catalyst for gold's rebound.
Overnight, the dollar index softened, and benchmark U.S. Treasury yields dipped slightly, providing a critical breathing window for non-interest-bearing gold. However, elevated oil prices squeezing policy room also capped gold's rebound potential. Brent crude held above $110 per barrel, as a fresh round of attacks on commercial vessels near the Strait of Hormuz, combined with a drop in U.S. crude inventories, continued to push energy prices higher. Persistently high oil prices mean inflationary pressure is unlikely to fade in the near term, directly compressing the room for central banks to pivot toward easing. The 10-year U.S. Treasury yield remained consistently above 5%, making the opportunity cost of holding gold hard to ignore — a factor whose short-term influence has even overshadowed gold's traditional appeal as a geopolitical risk hedge.
Looking ahead, next week's Federal Reserve policy meeting and PCE data could serve as catalysts for a directional choice. The market widely expects the Fed to keep rates unchanged, but investors will focus on any hints in the policy statement regarding December action. Meanwhile, U.S. PCE data, as the Fed's preferred inflation gauge, will directly influence the market's pricing of year-end rate hike intensity. If inflation data shows marginal easing, combined with Treasury yields falling back from above 5%, gold may have room for an upward correction; if inflation data once again exceeds expectations, a continued downward test for gold prices may be unavoidable.
Source: Wind, Everbright Futures Research Institute
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