Gold Climbs on Softer Dollar, Falling Treasury Yields After U.S. Midterms

By Giulia Petroni

Gold prices climbed more than 2% on Wednesday, supported by a softer dollar and falling Treasury yields after the U.S. midterm election results boosted demand for safe-haven assets.

In early European trading, gold futures in New York rose 2.3% to $4,032.90 a troy ounce after retreating below $4,000 last week. Among ​other metals, silver futures gained 4% to $51.78 an ounce, while platinum was up 1.8% to $1,455.70 an ounce.

Democrats won control of both chambers of the U.S. Congress in Tuesday's midterm elections, flipping Republican-held seats in several states. The results could introduce additional constraints on President Trump's agenda and reduce the likelihood of deficit-expanding legislation, according to analysts.

"Gold rallied amid expectations that a Democrat-controlled Congress could constrain Trump's fiscal agenda and limit further, increasingly unaffordable fiscal expansion," said Ole Hansen, head of commodity strategy at Saxo Bank.

The U.S. dollar index--which measures the greenback against a basket of other major currencies--fell 0.4% to 101.45, making dollar-denominated bullion more ​affordable for overseas buyers.

The prospect of further U.S. military action against Iran remains a key source of uncertainty for markets, with investors watching for signs of whether the Trump administration will return to the negotiating table or escalate its military campaign after the midterm elections.

Before the war began in late February, gold was trading above $5,000 an ounce. It dropped below the $4,000-an-ounce mark in late October, as soaring energy costs linked to the conflict raised expectations of further interest-rate hikes this year.

Traders are currently pricing in a nearly 77% probability of a Federal Reserve rate increase in December, according to CME's FedWatch tool. Higher interest rates raise the opportunity cost of holding non-yielding assets such as gold, reducing their appeal to investors.

Markets now await the release of the U.S. nonfarm payrolls report due on Friday for fresh cues on the Fed's policy path.

"The focus will be on the path of central bank monetary policy and rising debt levels," said Giovanni Staunovo, commodities strategist at UBS.

Write to Giulia Petroni at giulia.petroni@wsj.com

(END) Dow Jones Newswires

November 04, 2026 03:28 ET (08:28 GMT)