Gold prices held modest gains after U.S. Treasury Secretary Scott Bessent called on the Federal Reserve to reduce interest rates by at least 1.5 percentage points.
Earlier in the session the metal climbed as much as 0.6% before settling near $3,365 per ounce. Lower interest rates tend to support gold because it does not yield interest, making bullion more attractive when real yields decline.
So far this year, gold has risen about 28%, a rally supported by elevated geopolitical tensions and continued purchases by central banks seeking to diversify reserves.
Investors often view gold as a hedge against uncertainty and inflation. When central banks ease policy or when geopolitical risks increase, demand for the metal typically strengthens. Conversely, expectations of higher rates or a stronger dollar can weigh on prices.
Market participants will be watching upcoming economic data and central bank communications closely for signs of whether rate cuts are likely to materialize, as well as any shifts in safe-haven demand tied to global events. These factors will influence near-term price momentum and investor positioning in the gold market.