Gold Edges Higher as Weak Payrolls Cool Rate Fears, Central Banks Keep Buying
Published on 10/06/2026 at 20:20 | Editorial boerse-global.de
A disappointing US employment report has taken the steam out of bets on another Federal Reserve rate hike, handing gold a modest lift even as a firm dollar and elevated Treasury yields cap the upside.
Spot bullion changed hands at USD 4,160.19 an ounce, up 0.5% on the day, after closing the previous session at USD 4,140.77.
Payrolls Miss Resets the Rate Debate
The catalyst was September's nonfarm payrolls release, which showed just 29,000 jobs created outside the agricultural sector — a figure that fell well short of forecasts, according to Reuters. Authorities also revised the prior two months' employment readings lower.
Traders responded by scaling back expectations that the Fed might tighten again in October. Earlier in the cycle, rising oil prices and sturdy inflation prints had stoked fears of additional hikes, weighing heavily on the metal. Because gold pays no yield, it is particularly sensitive to the returns available on fixed-income assets — so any easing of rate pressure offers meaningful relief.
That relief has limits, however. A strong US dollar and high Treasury yields kept the recovery in check, preventing a more decisive breakout.
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ETF Demand Firms Up
Alongside the macro shift, investor appetite showed signs of stabilizing. Global gold ETFs recorded net inflows of more than 70 tonnes in September, according to media reports. The fact that buyers added to positions despite the prior price weakness underscores continued institutional interest.
Longer-term support comes from the world's monetary authorities. Speaking at the LBMA Global Precious Metals Conference, Bundesbank President Joachim Nagel argued that geopolitical risks and mounting sovereign debt continue to justify diversifying currency reserves.
Nagel noted that gold's share of global central bank reserves climbed from roughly 14% in 2023 to almost 25%. A substantial portion of that increase, he acknowledged, reflects the higher gold price itself.
He also stressed that physical bullion stored domestically carries no counterparty risk — unlike foreign securities or deposits — and cannot be blocked. The Bundesbank holds more than 3,500 tonnes, making it the world's second-largest official holder.
Survey Points to Record Appetite
The scale of official-sector demand is laid bare in a World Gold Council survey: 45% of responding monetary authorities intend to expand their holdings over the next twelve months, the highest reading since the poll began. Another 89% expect global reserves as a whole to rise. Beyond hedging geopolitical risk, respondents cited gold's long-term store-of-value function as a key motive.
That official bid acts as a counterweight to headwinds in capital markets. Higher government bond yields and a firm dollar have pressured prices recently. Roughly a month ago the US central bank raised its benchmark rate; since then the metal has shed 6.7%. On Tuesday, the spot price slipped 0.2% to USD 4,131.95 an ounce.
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Yields Still Weigh — But the Old Playbook Is Fraying
The rate backdrop remains a drag on futures markets. Elevated yields make fixed-income government paper more attractive to asset managers, since gold offers no coupon. Although the latest US jobs report came in soft and dampened expectations for further tightening in October, long-dated Treasury yields are still hovering near multi-year highs.
Even so, the market is proving unusually resilient to established patterns. Sergio Nicoletti Altimari, deputy governor of the Banca d'Italia, told the Sorrent gathering that the traditionally inverse relationship between gold and real yields has weakened since 2022. Structural shifts driven by official reserve buyers are absorbing at least part of the pressure from rising rates.
Looking ahead, Capital.com analyst Kyle Rodda sees geopolitics in the Middle East as the dominant driver for coming sessions, alongside the rate picture. Should tensions there escalate, demand for safe havens is likely to move back to the forefront quickly.
For now, market participants are watching whether upcoming economic data confirm a cooling US economy.
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