Spot gold advanced 0.3% on Monday to trade near $4,176 an ounce, while December US futures rose 0.4% to $4,196.40, as a drop in oil prices offered fresh support despite lingering Federal Reserve tightening expectations.
The move followed President Donald Trump's decision to waive certain sanctions and tariffs targeting Russia, potentially allowing more fuel exports. Brent crude fell nearly 1.8% to $107.92 after trading above $110 on Friday. Normally, reduced geopolitical tension might dampen gold's haven demand, but traders focused on the inflation-easing effect of cheaper energy, which could make further US rate increases less urgent.
Washington is reviewing the economic impact of the measures over 60 days, while attacks on commercial vessels near the Strait of Hormuz continue to threaten global flows. KCM Trade chief market analyst Tim Waterer said a more sustained decline in oil or Treasury yields would offer stronger support.
Fed pricing remains the main cap. Traders assigned only about a 16% probability to an October rate rise, against roughly 92% for an increase by December. Fed Chair Kevin Warsh avoided signalling a decision on the October 27–28 meeting, but September consumer inflation reached 3.7% and producer prices rose 6.3% year over year. Commonwealth Bank of Australia analyst Trent Saunders said repeated upside inflation surprises were making investors reassess the prospect of additional Fed increases. The next PCE inflation report is due October 29, after the Fed meeting.
World Gold Council data showed gold-backed ETFs attracted $10 billion in September, with holdings rising 67 tonnes to a record 4,256 tonnes, while managed-money futures positioning shrank by about $12 billion. Technical levels show resistance at $4,200 and the $4,215–$4,220 range top, with support at $4,145–$4,150 and then $4,100. A break below $4,065 could expose the year-to-date low near $3,957.
