Gold jumps 3.4% as dollar falls after Democrats win Congress
Spot gold climbed to US$4,059.95 an ounce, on course for its biggest daily gain since mid-August, as investors awaited Friday’s US jobs report.
- Spot gold experienced its biggest daily gain since mid-August, rising 3.4% to over US$4,000 an ounce.
- The primary driver for the gold price jump was the US dollar falling to its lowest level in more than a month.
- The dollar's decline occurred after Democrats won control of both the Senate and the House of Representatives in the US Congress.
- A weaker dollar makes gold cheaper for buyers using other currencies, and analysts linked the dollar's fall to concerns that political deadlock could slow the US economy.
Spot gold rose 3.4% to US$4,059.95 an ounce on November 4 as the dollar fell to its lowest level in more than a month after Democrats won control of the US Congress. By 2.04pm in New York, gold was on course for its biggest daily gain since mid-August.
The rally took gold back above US$4,000 an ounce just days after it hit US$3,869.85 on October 30, its lowest price since October 2025. US gold futures for December delivery settled 3.4% higher at US$4,073 an ounce.
Dollar falls after Democrats take both houses
Democrats won the Senate and the House of Representatives, taking seats in some Republican strongholds for the first time in generations. As investors weighed what the result meant for President Donald Trump’s agenda, one concern was that tighter regulation of artificial intelligence could slow US economic growth.
The weaker dollar made bullion cheaper for buyers using other currencies. Jim Wyckoff, a market analyst at American Gold Exchange, linked the dollar’s decline to expectations that political deadlock could weigh on the US economy and give the Federal Reserve more room to ease monetary policy.
US jobs report puts December rate decision in focus
Traders still saw about an 83% chance of a December rate rise, according to the CME Group FedWatch reading cited by Reuters. The Fed held rates steady in October. Higher rates make interest-bearing investments more attractive relative to gold, which pays no interest.
Oil also remained a concern for investors assessing inflation. Brent crude had traded above US$100 a barrel earlier in the day as markets awaited Washington’s next move in the US-Israeli war on Iran.
US private employers added jobs at a faster pace in October, according to the ADP National Employment Report. The broader US nonfarm payrolls report is due on Friday, November 6.
Daniel Ghali, head of metals research at Deutsche Bank, said a strong jobs figure could reinforce expectations of rate rises. He saw little reason for investors to raise their estimate of where rates would peak, given the labour market’s limited influence on the inflation outlook.
Other precious metals also rose. Spot silver gained 4.9% to US$52.23 an ounce, platinum climbed 5.6% to US$1,496.40 and palladium advanced 7.5% to US$1,004.
