Gold Prices Rise After Hitting a One-Year Low – Oil Price Decline and U.S. Elections Fuel Recovery
Gold prices recovered during Monday’s trading, moving away from their lowest levels in a year. This rebound was supported by a decline in global oil prices, which helped ease inflation concerns.
Meanwhile, investors are closely watching the U.S. midterm elections scheduled for tomorrow, anticipating their potential impact on fiscal policy and geopolitical developments.
The price of gold has risen to $3,900 per ounce, while U.S. gold futures for December delivery climbed 0.3% to $3,911.50 per ounce.
This recovery follows a sharp sell-off in the precious metal during Friday’s session, when prices dropped by 3.5% reaching their lowest level since October 2025.
The decline was driven by a wave of selling in technology and artificial intelligence stocks, which prompted investors to increase their cash holdings and liquidate some of their gold investments.
Falling Oil Prices Ease Inflationary Pressures and Support Gold
A drop of more than 4% in oil prices during Monday’s trading helped improve sentiment in the gold market.
This shift followed discussions between Iranian and Qatari officials regarding a potential agreement to end the U.S.-Israeli conflict with Iran, sparking hopes for a de-escalation of tensions in the Middle East and more stable energy supplies.
A decline in oil prices typically eases inflationary pressures, which may reduce the likelihood of interest rates remaining high for an extended period.
This serves as a supportive factor for gold a non-yielding asset since the opportunity cost of holding it decreases when expectations for high interest rates subside.
Meanwhile, optimism regarding a potential diplomatic breakthrough between the United States and Iran, coupled with renewed skepticism about the sustainability of the artificial intelligence boom, helped boost gold prices during Monday’s trading.
However, this recovery could prove temporary, given the persistent pressures stemming from financial market volatility and liquidity dynamics.
US Midterm Elections Heighten Investor Caution
Global markets are turning their attention to the US midterm elections scheduled for November 3, with investors closely monitoring the potential impact of the results on US fiscal policy, geopolitical trends, and overall market sentiment.
The election outcomes are expected to influence how investors assess the trajectory of government spending and US economic policies—factors that could, in turn, affect the dollar, gold, and financial markets at large.
Markets may approach the US elections with caution, particularly given the possibility that the results could be linked to geopolitical developments in the Middle East.
Furthermore, the ongoing sell-off in technology stocks could exert additional pressure on gold, as some investors have been forced to liquidate their holdings of the precious metal to generate liquidity and cover losses in other sectors.
Silver Prices Rise Toward $50 - Platinum and Palladium Decline
Among other precious metals, silver saw a notable recovery during Monday’s trading, with its spot price climbing 2% to reach $50 per ounce.
This gain follows a dip below the $50 mark in the previous session—the first such decline since late November 2025.
Conversely, the spot price of platinum fell by 0.2% to $1,428.45 per ounce, while palladium dropped 0.8% to $968.59 per ounce.
Gold Price Outlook for the Period Ahead
Gold’s movements in the coming period will remain tied to several key factors, most notably oil price trends, the trajectory of U.S. inflation, Federal Reserve monetary policy expectations, the results of the U.S. midterm elections, and geopolitical developments in the Middle East.
While a decline in oil prices could provide some support to gold by easing inflationary concerns, ongoing financial market turbulence and asset liquidation may limit the precious metal’s ability to sustain a recovery.
Consequently, gold’s rise above the $3,900-per-ounce level could signal the beginning of a broader recovery, following the sharp decline the precious metal experienced over the past few sessions.
