Gold Prices Rise as Oil Declines, Investors Await US Midterm Election Results

• Gold prices increased in early Asian trading, with spot gold rising 0.2% to $3,934.75 per ounce.
• Falling oil prices eased inflation concerns, supporting demand for gold amid uncertainty over US monetary policy.
• Investors are closely monitoring US midterm election results, upcoming labour market data and geopolitical developments.

Gold prices edged higher in early Asian trading on Wednesday as declining oil prices helped ease inflation concerns, while investors remained cautious ahead of the US midterm election results and important economic data that could influence the Federal Reserve’s next interest rate decision.

Spot gold gained 0.2% to reach $3,934.75 per ounce by 0024 GMT, while US gold futures for December delivery increased 0.1% to $3,943.20.

The modest increase came as global financial markets assessed developments in energy prices, geopolitical tensions and the outlook for US monetary policy.

Oil prices fell approximately 1% on Tuesday, reaching their lowest level in nearly four weeks. The decline followed market assessments of diplomatic efforts to resolve the conflicts involving Ukraine and Iran, although concerns remained over potential supply disruptions caused by recent attacks.

Lower energy prices generally help reduce inflationary pressures, potentially giving the US Federal Reserve greater flexibility in its monetary policy decisions.

Gold, which does not offer interest or regular income, typically becomes more attractive when borrowing costs decline or expectations of prolonged high interest rates weaken.

Despite easing inflation concerns, uncertainty surrounding the Federal Reserve’s next policy decision continued to influence market sentiment.

According to CME Group’s FedWatch tool, traders were pricing in a 78% probability of an interest rate increase in December, reflecting expectations about the central bank’s future monetary policy.

Investors were also awaiting important US labour market figures, which could provide further indications about the strength of the American economy and the direction of interest rates.

Political developments in the United States added another layer of uncertainty, with markets closely following Tuesday’s midterm elections.

Investors were preparing for the possibility of a strong performance by the Democratic Party, an outcome that could influence financial markets and trigger greater volatility across different asset classes.

Meanwhile, international diplomatic developments remained an important factor affecting commodity markets.

The Kremlin confirmed on Tuesday that Russia, Ukraine and the United States would hold three-way peace negotiations in Abu Dhabi on November 10 and 11.

The planned discussions are expected to focus on efforts to resolve the conflict in Ukraine, which has continued to affect international energy markets and investor confidence.

Separately, diplomatic efforts to end the conflict involving Iran and the United States remained uncertain.

A senior Iranian official told Reuters on Tuesday that Tehran and Washington were still far from reaching an agreement to end the war.

Qatar, which has been acting as a mediator, intensified its diplomatic efforts to narrow differences between the two sides and prevent another escalation following the US midterm elections.

Developments in both conflicts have remained significant for global oil markets, where traders are balancing the possibility of diplomatic progress against the risk of further disruptions to energy supplies.

In the physical gold market, India is expected to experience a significant decline in demand during 2026 as elevated prices discourage jewellery purchases and investment activity slows.

The World Gold Council said on Tuesday that India’s gold demand could fall to its lowest level in six years.

The expected slowdown reflects the impact of persistently high gold prices on consumer purchasing decisions, particularly in the jewellery sector, which represents an important component of India’s overall gold consumption.

Other precious metals recorded mixed movements during early trading.

Spot silver declined 0.2% to $49.67 per ounce, while platinum increased 0.3% to $1,422.15 per ounce.

Palladium also registered gains, rising 0.5% to $938.49 per ounce as trading continued across international precious metals markets.