Gold Rises to $4,169 as October Rate Hike Bets Decline

Spot gold rose 0.7% to $4,168.89 an ounce by 1139 GMT, and US December gold futures climbed 1% to $4,196.90, as declining bets on a US rate hike in October offset the impact of a strong dollar and rising bond yields.

Data from the CME FedWatch tool showed markets pricing in a 21% probability of a rate hike at the October meeting, compared to around 70% for the December meeting. US 10-year and 30-year Treasury bond yields reached new 24-year highs during Monday's session, raising the cost of holding non-yielding gold.

In other precious metals markets, silver settled at $61.10 an ounce, platinum fell 0.6% to $1,710.71, and palladium slipped 1% to $1,160.66, according to the intra-day update.

Ole Hansen from Saxo Bank said gold is trading near key support just above $4,100, adding that market focus will remain on "the dollar, bond yields, and ongoing political and financial turmoil."

What do these terms mean?

Spot Gold: The price for immediate delivery of the metal upon buying and selling, unlike futures contracts where delivery is executed at a later date.

FedWatch Tool: A tool tracked by the Chicago Mercantile Exchange that measures the probability of a US rate change at each meeting based on futures contract trading.

Bond Yield: The annual percentage earned by a bondholder, where a rise increases the opportunity cost of holding non-yielding gold.

Support Level: A price level at which buyers tend to buy, temporarily halting a price decline.