Gold futures gain as U.S. dollar, yields turn lower

Gold futures snapped back-to-back losing sessions Tuesday as the rally in U.S. Treasury yields took a breather and the dollar pulled back from the previous day's 18-month high, while investors ‌awaited the minutes of the Federal Reserve's September meeting for fresh clues on its monetary policy outlook.

The 10-year Treasury yield declined to 5.269% from its Monday settlement of 5.310%, which was the highest since 2002, according to Tradeweb, and French government bonds recovered after a sharp selloff due to recent budget concerns.

"Despite near-term headwinds, ongoing ETF buying and demand from discretionary investors continues to provide support for gold," TD Securities analysts said in a note, maintaining their forecast for gold to push past $5K/oz in 2027.

However, Fawad Razaqzada of Forex.com sees the outlook for gold remaining fragile despite the recovery, as "while dovish Federal Reserve repricing and lower oil prices in the last couple of days has provided some support, the metal is still undermined by the elevated yields and the risk that oil prices may rebound and create fresh volatility for financial markets."

Delegates at the London Bullion Market Association's annual gathering in Sorrento, Italy, predicted gold and silver prices will reach $5,013/oz and $97/oz within the next 12 months.

Gold and silver have declined 3.8% and 12.8% YTD, respectively.

On Tuesday, front-month Comex gold (XAUUSD:CUR) for October delivery gained 0.7% to $4,159.20/oz and front-month Comex October silver (XAGUSD:CUR) added 0.5% to $61.168/oz.

ETFs: (GLD), (GDX), (GDXJ), (IAU), (NUGT), (PHYS), (GLDM), (AAAU), (SGOL), (DUST), (RING), (BAR), (OUNZ), (SGDM), (SGDJ), (SLV), (PSLV), (SIVR), (SIL), (SILJ)