Gold bounces back amid weak US Dollar, falling US yields

XAU/USD gains over 0.13% on Wednesday, rebounding from a weekly low of $2,605 due to a weaker US Dollar and declining US Treasury yields.

US economic data show strength with the second GDP estimate for Q3 and strong labor market data.

The core Personal Consumption Expenditures (PCE) Price Index aligns with expectations yet continues to rise.

Gold prices recover on Wednesday after dropping to a weekly low of $2,605, bolstered by a soft US Dollar responding to the release of US economic data. This alongside falling US Treasury bond yields, spurred Gold’s recovery to current prices. The XAU/USD trades at $2,636 up by 0.13%.

The market mood turned slightly sour as US equity markets prepared for Thanksgiving. In the meantime, the Federal Reserve’s (Fed) preferred inflation gauge, the core Personal Consumption Expenditures (PCE) Price Index, justifies the Fed's gradual approach, which is expected to lower borrowing costs at the December meeting.

Other data showed that the economy remains robust after the release of the second estimate of the third quarter's Gross Domestic Product (GDP). At the same time, jobs data revealed that the labor market remains strong as the number of Americans applying for unemployment benefits dipped below estimates.

Following the data, US Treasury bond yields fell, dragging the Greenback lower. The US Dollar Index (DXY), which tracks the performance of six currencies against the buck, tumbled 0.78% to 106.04.