Gold prices posted their strongest performance in two weeks on September 3, 2026, as spot bullion surged as much as 2.6%, marking the biggest intraday increase since August 19. The rally was driven by a combination of a weakening US dollar against the Japanese yen and shifting expectations regarding Federal Reserve monetary policy. Federal Reserve Governor Christopher Waller's comments suggesting he expects "reasonable" inflation prints next month significantly boosted gold sentiment.
His remarks prompted traders to reduce their bets on potential rate hikes by the US central bank later this year. Since gold generates no yield, lower interest rates are generally supportive for the precious metal, making it more attractive to investors. Ole Hansen, head of commodity strategy at Saxo Bank, noted the importance of both factors in gold's recovery: "Gold is seeing a strong rebound, which was already underway before Fed Governor Christopher Waller came to the rescue by helping lower bond yields and reducing market expectations for a September rate hike.
Before his comments, gold was already moving higher, supported by a weaker dollar, not least against the Japanese yen." The market has been particularly sensitive to Fed communications in recent weeks. Gold declined for three consecutive sessions following Chair Kevin Warsh's hawkish speech on Friday, during which he reiterated the central bank's commitment to fighting inflation and fueled expectations for higher interest rates. Additionally, elevated energy prices stemming from renewed tensions in the Middle East have maintained expectations for further monetary tightening.
At 10:09 a.m. in New York, spot gold rose 1.9% to $4,462.90 per ounce. Silver advanced 1.4%, while platinum and palladium also posted gains. The Bloomberg Dollar Spot Index, which tracks the overall strength of the US currency, fell 0.5%.
Market participants are now focused on upcoming economic data that could influence the Fed's policy trajectory. Friday's payrolls report and inflation data expected next week are anticipated to provide critical guidance on the direction of monetary policy. Gold's performance this year has been volatile following a record high set in January and a subsequent four-month decline through June.
The recovery from June lows has been supported by multiple factors, including investor concerns about Middle East conflicts and central bank buying activity. Ryan McKay, senior commodity strategist at TD Securities, emphasized the importance of rate expectations: "With hike pricing remaining elevated amid lingering inflation concerns, timing remains the main question for the next leg higher in the yellow metal." Central bank purchases have also provided underlying support to gold prices, with reports indicating continued accumulation of reserves by major institutions. This institutional demand, combined with macro uncertainties, continues to underpin gold's appeal as a portfolio diversifier and store of value.
Source: Bloomberg News, Mining.com, September 3, 2026
Source: mining.com