Gold rebounds as calmer U.S. rates and a weaker dollar ease pressure

Gold is finding room to breathe again. After recently pressuring financial markets, the sharp rise in U.S. Treasury yields has eased, helping prices rebound.

The Korea Gold Exchange said the price of one don, or 3.75 grams, rose by 5,000 won, or 0.58%, on Sept. 4 to 865,000 won. International gold prices also jumped.

The retreat in Treasury yields came alongside dovish remarks from senior Federal Reserve officials. Those comments eased some market concern about an interest-rate increase in September. Because gold pays no interest, falling market rates typically improve its relative appeal as an investment.

A stronger yen has also contributed to the dollar’s weakness. The yen gained sharply against the dollar, pushing down the Dollar Index, which measures the U.S. currency against major currencies. That created more favorable conditions for gold, which trades in dollars. When the dollar weakens, gold becomes less expensive in other currencies, supporting demand.