Gold Steadies Near $4,160 as Sliding Treasury Yields and Warsh's Neutral Remarks Weigh on Dollar

Gold steadied near $4,160 an ounce on Friday after surging more than 1% on Thursday, its biggest single-session gain in over two weeks, as a selloff in equities pushed investors into bonds and drove the 10-year Treasury yield to a three-week low of 5.035%. The weaker yields narrowed the dollar's interest-rate differentials, pulling the dollar index to a one-week low and dropping it 0.49% on the day, providing broad support for the metal.

Fed Chair Kevin Warsh delivered remarks at an International Monetary Fund meeting in Bangkok, and his neutral tone added modest pressure on the dollar while doing little to revive gold's upward momentum heading into the Asian session. Traders are pricing in only a 19% chance of a Fed rate hike at the October meeting, though December hike bets stand at roughly 88%, keeping some safe-haven demand for the dollar alive and capping gold's gains.

US Treasury official Browne cautioned that disorderly foreign exchange moves risk spreading volatility across financial markets, underscoring the sensitivity of currency and bond markets at current yield levels. Asian currencies were largely subdued, though the Indian rupee was on track for a roughly 2% weekly gain against the dollar.