Spot gold rebounded above $4,000 an ounce following the US midterm elections. The recovery followed a softer dollar and falling Treasury yields as political gridlock in Washington reduced fiscal stimulus expectations.
Gold Prices Surge Following Democratic Midterm Election Wins
Gold prices surged nearly 3.4% on Wednesday in their sharpest single-day gain since August 19. The move followed the Democratic Party winning control of both chambers of Congress in the US midterm elections, according to the Bangkok Post.
Gold buyers were urged to avoid speculation as prices remain highly volatile, according to Jitti Tangsithpkul, president of the Gold Traders Association. Bullion gained more than $250 this week after hitting a one-year low of $3,869.85 an ounce on the final Friday of October.
Pawan Nawawattanasub, chief executive of YLG Group, noted that international prices exceeded $4,100 an ounce partly due to improving market sentiment following the elections.
BREAKING: Gold and silver prices surge after the Democrats take control of the US House and Senate. The metals have added a combined +$1 trillion in market cap today. pic.twitter.com/zpsxFpTnUI
The 10-year Treasury yield fell from an October high of 5.36% to 4.837% (a two-month low). The dollar index dropped to 101.60, its lowest level since late September. Lower real yields reduce the opportunity cost of holding precious metals.
Central Banks Acquire Reserves
According to the World Gold Council, central banks acquired a net 70 tonnes of gold during the third quarter. Alternate figures referenced by analysts indicated that central bank purchases reached 321 tonnes in the third quarter—marking a 42% year-over-year rise, the highest-performing quarter since the final quarter of 2024, and lifting total purchases for the year to 675 tonnes.
China accumulated 80.2 tonnes total including 20.2 tonnes in August and 63 tonnes in the third quarter, lifting its total reserves to 2,410 tonnes. Poland added 97.8 tonnes through August to reach 647.98 tonnes.
Silver rallied alongside gold, surging 4.39% to approximately $51.97 per ounce on Wednesday and trading near $52.390, up $0.294 or 0.56% at subsequent readings.
Spot silver bulls targeted a break above the $53.070 to $54.450 resistance area with a sustained breakout aiming for $56.360. Downside support rested at $51.240 and $50.030.
On November 6, physical retail markets saw silver quoted at ₹1,83,990 per kg in New Delhi, ₹1,84,310 per kg in Mumbai, and ₹1,84,980 per kg in Chennai. Gold futures for December on the Multi Commodity Exchange settled at ₹1,42,224 per 10 grams following profit-taking declines.
Technical resistance for gold sits near $4,207 and $4,226. Gold needs a decisive break above $4,226 to extend its rally.
Support is established at $4,065, $4,030, $4,000, and lower Fibonacci levels including the 50.0% retracement at $4,006 and the 38.2% retracement at $4,039, Business Standard and TradingPedia reported.
Jobs Data Affects Federal Reserve Plans
Gold gapped lower on a stellar employment report (that was) strong across the board, but is trying to claw back higher. This is a litmus test for this week’s rally,
said independent metals trader Tai Wong, as reported by FXStreet.
Analysts at OCBC noted that gold pared earlier gains after rising to a two-week high above $4,140 overnight. Goldman Sachs lowered its end-2026 gold price forecast to $4,150 per ounce from $4,650 due to a more hawkish Federal Reserve stance.
Markets subsequently priced an approximate 80% probability of a 25-basis-point December rate hike.
Earlier coverage: Goldman Sachs Cuts Gold Price Forecasts for 2026 and 2027