Gold tugged between yields and geopolitics
Gold fell again this week as high US Treasury yields raised the cost of holding the metal, while Iran and Hormuz risk stayed unresolved. Spot prices near $4,300 posted another weekly loss. Sunday reports that Washington rejected a Hormuz reopen plan put the safe-haven bid back in focus for Monday.
Gold spent the week tugged between rising US Treasury yields and unresolved geopolitics around Iran and the Strait of Hormuz. Higher yields raise the opportunity cost of holding a metal that pays no coupon. Hormuz risk can still spark safe-haven demand — or feed oil-driven inflation fears that keep the Fed hawkish.
By Friday mid-session, a Reuters wrap on Kitco had spot gold near $4,274.94 an ounce, down about 0.1% and on track for a roughly 2.4% weekly loss — a fourth weekly decline in five weeks. US futures traded near $4,310. A Sunday Reuters reprint put spot near $4,291 with the week still down about 2%. Bullion remains roughly 19% below its late-February high and more than 20% under January's record near $5,589.
The yield side is measurable. Saxo Bank's Sept. 24 note put the 10-year Treasury yield above 5.1% and the 10-year real yield near 2.78% — an 18-year high — with gold near $4,262 and down about 4% on the month. Reuters reported the 30-year yield touching about 5.48% on Sept. 24, its highest since 2004, with the 10-year near 5.20%. When real yields climb, Treasuries compete harder with gold.
Fed pricing reinforced that headwind. After the mid-September quarter-point hike — the first in three years — Kitco's Reuters wire cited CME FedWatch odds near 64% for an October hike and 93% for December; Sunday reprints still showed elevated odds near 71% and 95%. Analysts tied the weekly slide to runaway yields and sticky inflation fears kept alive by energy prices since the US-Israeli war with Iran began.
Geopolitics did not exit the tape. Diplomacy hopes around a Hormuz reopen briefly soft-patched oil and gold midweek. Sunday desks then refocused after reporting that Washington rejected Iran's conditional Hormuz/ceasefire proposal, even as Tehran mixed readiness warnings with continued talk of diplomacy. Escalation can draw a defensive bid; energy spikes can also lock in higher yields that weigh on bullion.
Less rate-sensitive demand helps explain the floor. Saxo cited Bloomberg data showing global gold ETF holdings up almost 50 tonnes in September despite the real-yield jump, and Chinese gold demand already past 1,000 tonnes through August — ahead of all of 2025. Those flows help keep prices above summer lows near $4,000.
Watch Monday ETF flows and any mediator messages on Hormuz; this week's August PCE print and September jobs report for the Fed path; and whether spot holds support near $4,235 if yields stay high.
Kitco's Reuters wire and Saxo agree that elevated yields plus hawkish Fed pricing have been the immediate weight on gold, while Iran/Hormuz risk remains a live second driver. They differ on the next swing: the market wrap stresses the weekly loss and hike odds, while Saxo highlights resilient ETF and Chinese demand that could cushion a deeper break if fiscal or geopolitical stress outweighs opportunity-cost selling.
Where outlets agree Kitco's Reuters wire and Saxo's commodities note agree that elevated US Treasury yields — including a 10-year near or above 5% and real yields near multi-year highs — plus hawkish Fed hike pricing have pushed spot gold into another weekly loss near the mid-$4,200s, while Iran and Strait of Hormuz risk remains a second live driver.
Where they differ The Reuters/Kitco wrap emphasizes the weekly price decline and FedWatch hike odds as the near-term story; Saxo stresses that September ETF inflows and strong Chinese demand show many buyers are less sensitive to real yields and may keep supporting gold if fiscal or geopolitical stress intensifies.