I. London Gold Extends Rebound from Two-Month Lows



On October 9, London gold traded at $4,152.77 per ounce, up $19.81 or 0.48% intraday.

The session opened at $4,134.23 against a previous close of $4,132.96, logging an intraday high of $4,153.35 and a low of $4,130.84.

On the 1-hour timeframe, bullion held comfortably above MA1 ($4,142.40), MA20 ($4,134.07), and MA30 ($4,128.49).

With markets monitoring internal Fed divisions alongside US-Iran negotiations, gold maintained its recovery off two-month troughs.

Gold tapped its lowest levels since August 5 on Wednesday before rebounding on Thursday.

Following two sessions of gains, benchmark yields retreated after solid demand for the US 30-year bond auction, pulling the Dollar Index down 0.14% to 102.11 on Thursday.

Bullion capitalized on the pullback, though broader market expectations for further tightening this year remain resilient.

II. Trump Rules Out Pre-Election Strike on Iran



Trump stated on Thursday that the United States will not launch strikes against Iran ahead of the November midterm elections, noting that both nations are engaged in 'productive' talks to end hostilities.

While proposals to end the war and reopen the Strait of Hormuz have been exchanged in recent weeks, Trump rejected Tehran's latest submission.

Iranian state media reported on Thursday, citing the head of its Atomic Energy Organization, that Iran will neither surrender its enriched uranium stockpiles nor abandon enrichment activities.

Just days earlier, US Vice President JD Vance maintained that Iran must 'substantively' dismantle its enrichment capabilities, underscoring unresolved friction on nuclear matters.

III. Waller Emphasizes Flexibility on Rate Hikes While December Odds Remain Elevated



Fed Governor Christopher Waller indicated on Thursday that additional tightening may be warranted to steer inflation toward the 2% target, but emphasized 'flexibility' in the pace of hikes, leaving room for an October pause.

CME FedWatch data shows traders pricing a 17% probability of an October rate increase, compared to an 83% likelihood in December.



Minutes from the Fed's September meeting revealed divergent policy rationale among officials.

Some favored higher rates to curb energy and commodity price shocks, whereas more hawkish policymakers sought to preempt emerging demand-driven inflation.

WisdomTree strategist Nitesh Shah noted that the absence of a predetermined policy path in the minutes contributed to heightened volatility across precious metals.

St. Louis Fed President Alberto Musalem also reiterated that another rate hike is needed to return inflation sustainably to 2%.

The US Department of Labor reported that initial jobless claims dropped by 2,000 to 197,000 last week, printing slightly below consensus forecasts of 200,000.

Official rhetoric and labor market indicators remain pivotal benchmarks for assessing forward monetary guidance.

IV. Market Outlook and Core Drivers

The upcoming October FOMC meeting stands as the next critical juncture for financial markets.

Investors will track inflation prints, Fed speeches, Treasury auctions, and developments surrounding the Strait of Hormuz transit.

Prospects of a policy pause, December tightening bets, and sovereign debt concerns will continue to direct gold's medium-term path.