Global gold prices reversed course and fell slightly in trading on November 3 (GMT), pressured by the strengthening US dollar and rising US government bond yields, while investors awaited the results of the US midterm elections for signals on fiscal policy.
At 7:06 PM GMT on November 3rd (2:06 AM on November 4th in Vietnam time), spot gold prices fell 0.5% to $3,927.18 per ounce, after briefly dropping 1% to a session low of $3,893.31 per ounce.
Oil futures for December delivery closed down 0.7%, at $3,940.40 per ounce.
In the energy market, oil prices fell to their lowest level in three weeks as the market considered the conflicting impacts of talks to end the fighting in Ukraine and Iran and concerns about potential supply disruptions from recent attacks in both conflicts.
The drop in oil prices had initially helped to alleviate some concerns about inflation, giving gold a brief surge before it reversed course and fell again.
Phillip Streible, chief market strategist at Blue Line Futures, said the breakout of the US dollar coupled with higher bond yields has put pressure on gold prices. The greenback edged higher as investors considered uncertainty surrounding a potential deal between the US and Iran, as well as the outcome of the midterm elections. At the same time, US government bond yields also edged higher.
All attention is currently focused on the US election taking place on November 3rd.
Opinion polls and independent analysts are leaning towards the possibility of the Democrats regaining control of the House of Representatives from the Republicans, while the race for control of the Senate remains uncertain.
Fawad Razaqzada, a market analyst at Forex.com, suggests that if the Democrats win overwhelmingly in both houses of Congress, the US dollar could face downward pressure as the administration will have more difficulty passing legislation, including measures related to the debt ceiling. He further notes that a weaker dollar would be a potential support for gold prices.
Following the same trend as gold, spot silver prices fell 1.9% to $49.69 per ounce, while platinum prices declined 1.9% to $1,421.18 per ounce.
In Vietnam, on the afternoon of November 3rd, the price of SJC gold in the Hanoi market was listed by Saigon Jewelry Company at 137.60-140.60 million VND/ounce (buying price – selling price).