Spot gold hits three-month low amid risk-off moves, climb in oil prices

Gold prices fell to a three-month low on Thursday as a sharp rally in crude oil and a broad risk-off mood across financial markets pushed the metal through a closely watched support area, according to a report from Investing.com.

Gold futures dipped 0.5% to settle at $4,039.90 an ounce. The move extended a run of weakness that has taken bullion well below the $4,100 level it had been defending for much of October. David Morrison, senior market analyst at Trade Nation, noted that gold had "once again broken below intermediate support around $4,100," describing it as the third such break this month, with earlier dips proving short-lived as buyers stepped in.

A notable feature of this week's decline is that it has come alongside, rather than against, weakness in the US dollar. Morrison pointed out that the selloffs in both gold and silver occurred despite a significant drop in the greenback. Gold is priced in dollars and often moves inversely to the currency, so simultaneous declines in both are unusual and suggest other forces, including positioning and cross-asset risk flows, are at work.

The immediate trigger cited in the report was energy. Brent crude futures jumped 3.7% to settle at $112.89 a barrel, an over five-month high, and that surge weighed on gold on Thursday. Higher oil prices feed into headline inflation, which in turn shapes expectations for central-bank policy. When markets price in a longer period of restrictive interest rates, the opportunity cost of holding non-yielding assets such as gold tends to rise, a dynamic that has repeatedly been flagged as a headwind for bullion this month.

Separately, Reuters reported earlier in the week that the US dollar was mixed on Wednesday as traders weighed renewed oil-driven inflation risks and waited for the Federal Reserve's meeting the following week, while the Australian dollar gained on hawkish central-bank commentary. The same report noted that Brent crude was near five-month highs and that falling US crude and product inventories had added to the gains. The dollar index slipped 0.03% to 101.76 in that session, with the euro at about $1.1224.

US labour-market data has added another layer to the picture. Kitco News reported on Thursday that gold was struggling below $4,100 an ounce and could face further selling pressure, with fewer American workers applying for unemployment benefits than expected as weekly jobless claims fell to a three-month low. In that session gold last traded at $4,076 an ounce, down 1.5% on the day. A resilient labour market reduces the urgency for policy easing, which has historically been a less supportive backdrop for precious metals.

Currency markets, meanwhile, have been moving in the opposite direction to the dollar's usual relationship with gold. FXStreet reported that the US Dollar Index declined to its lowest level in roughly three weeks near 101.50 on Thursday, with the 10-year US Treasury yield holding below 5.1% and easing on the day, as risk flows dominated and Wall Street's main indexes registered strong gains midweek.

Taken together, the session illustrated how multiple drivers can pull in different directions at once: a softer dollar that would normally help gold, set against firmer oil, steady labour-market readings and caution ahead of the Fed meeting. Market participants will be watching upcoming data releases and the central bank's communications for clarity. Past price behaviour is not a reliable indicator of what comes next, and short-term moves in commodities and currencies can reverse quickly.

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This is a news summary for general information only — not financial advice, and nothing here is a recommendation to buy or sell any currency or metal. Exchange rates and gold prices can move sharply around data releases and central-bank decisions, and trading them carries a real risk of loss, which leverage magnifies. Always verify against the original source and do your own research before making a financial decision.