Gold Falls for Sixth Straight Week as Yields and Dollar Keep Pressure on Bullion

Gold extended its losing streak to six consecutive weeks, its longest since August 2018, as elevated Treasury yields and a stronger U.S. dollar outweighed renewed ETF demand. The LBMA Gold Price PM fell 1.7% last week to $4,190 per ounce, taking its 2026 decline to 4.1%.

By Paul Ploumis
Published October 6, 2026

MONTREAL (Scrap Monster): Gold extended its decline for a sixth consecutive week as high U.S. Treasury yields and a firm dollar continued to challenge the precious metal despite persistent investor demand and geopolitical uncertainty.

The LBMA Gold Price PM fell 1.7% last week to $4,190 per ounce, according to the World Gold Council, leaving bullion down 4.1% since the beginning of 2026.

The six-week decline is gold's longest weekly losing streak since August 2018.

Yet the underlying market is considerably more complicated than the falling price alone suggests. Gold-backed exchange-traded funds continue to attract capital, and the metal still finished the third quarter higher despite a particularly difficult September.

Higher Yields and Dollar Extend Gold's Losing Streak

Gold began last week under pressure as geopolitical tensions and energy-market concerns fed into expectations for inflation and interest rates.

Rising Treasury yields increased the opportunity cost of holding gold, which does not generate income, while a stronger U.S. dollar made bullion more expensive for buyers using other currencies.

The World Gold Council said bond yields and the dollar both finished the week higher, reinforcing two of the most persistent headwinds for gold during 2026.

The benchmark U.S. 10-year Treasury yield has recently traded above 5%, keeping real and nominal interest rates at levels that remain challenging for non-yielding assets.

Weak U.S. Jobs Report Changes the Fed Calculation

The macro picture became more supportive for gold later in the week.

U.S. nonfarm payrolls increased by only 29,000 jobs in September, well below expectations, while the unemployment rate edged higher to 4.2%.

July and August payroll growth was also revised down by a combined 60,000 jobs.

The weaker labor data substantially reduced market expectations for another Federal Reserve rate increase at the October meeting.

Gold initially responded positively to the report, recovering some of its earlier losses, although high longer-term Treasury yields and continued dollar strength prevented a sustained rebound.

PCE Inflation Offers Some Relief but Remains Elevated

The latest U.S. inflation figures also reduced some of the pressure for immediate additional tightening.

The August Personal Consumption Expenditures price index increased 3.4% from a year earlier, unchanged from July.

Core PCE inflation, which excludes food and energy and is closely watched by the Federal Reserve, remained at 3.0% year over year.

On a monthly basis, headline PCE increased 0.3%, while core inflation rose 0.2%.

The data did not signal that inflation had returned to the Fed's target, but they were sufficiently contained to reduce expectations for another immediate rate increase when combined with the weaker labor-market report.

September Produced an Unusual Gold Market Divergence

The most striking development came from investor positioning.

Gold fell by more than 8% in U.S. dollar terms during September, yet global physically backed gold ETFs attracted more than 70 tonnes of net inflows.

The World Gold Council described the combination as highly unusual.

Measured against monthly data going back to 2004, September's price decline ranked among the more severe monthly selloffs, while ETF accumulation was simultaneously among the stronger inflow months.

In other words, investors using ETFs were adding gold while other parts of the market were selling.

U.S. Investors Lead Renewed ETF Inflows

Global gold ETF flows remained positive during the latest week, led by North American funds.

European and Asian funds also recorded positive activity, while futures investors continued to reduce net-long exposure.

The difference between ETF accumulation and futures positioning highlights the split between investors maintaining longer-term gold exposure and shorter-term traders responding to yields, the dollar and monetary-policy expectations.

Gold Still Gained 3.7% During the Third Quarter

September's steep decline also needs to be viewed against the stronger performance earlier in the quarter.

Gold finished the third quarter 3.7% higher despite losing more than 8% during September.

That reflects the strength of the rally earlier in Q3 before rising yields and tighter financial conditions reversed part of those gains.

For comparison, the World Gold Council said the MSCI U.S. Index gained 2.0% during Q3, while U.S. Treasuries returned negative 3.5%, their weakest quarterly performance since late 2022.

Why Geopolitical Risk Has Not Automatically Lifted Gold

Geopolitical uncertainty would ordinarily be expected to support safe-haven demand for gold.

In the current market, however, tensions have also pushed energy prices and inflation expectations higher at different points, which can strengthen expectations for tighter monetary policy.

That creates competing forces for bullion.

Heightened uncertainty can increase demand for gold as a defensive asset, but if the same event raises oil prices, Treasury yields and the dollar, those moves can simultaneously put downward pressure on gold.

The World Gold Council identified this interaction between geopolitical developments, inflation expectations and Federal Reserve pricing as one of the key forces shaping gold during 2026.

Six Weekly Losses Do Not Tell the Entire Demand Story

Gold's six-week losing streak is significant, particularly because a comparable run has not occurred since 2018.

But the accompanying flow data suggest the market is not experiencing a simple collapse in investor interest.

ETF buying remains positive, Q3 remained profitable for gold holders, and softer U.S. employment data have reduced the probability of another immediate Federal Reserve hike.

Against that, Treasury yields remain historically high, the dollar is firm and futures-market positioning has become more cautious.

Those competing signals explain why gold has struggled to establish a clear near-term direction even as strategic demand remains visible.

What Gold Traders Are Watching Next

Monetary policy remains the most immediate catalyst.

The minutes from the Federal Reserve's September meeting are due this week and will be closely examined for evidence of how strongly policymakers support additional tightening.

Markets will also watch incoming U.S. inflation expectations and economic data for signs that the weak September jobs report represents a broader slowdown rather than a one-month anomaly.

Treasury yields and the U.S. dollar remain equally important. A meaningful decline in either could reduce two of the strongest pressures currently facing gold.

Conversely, another rise in yields or renewed energy-driven inflation concerns could prolong the correction.

Market Read

Gold enters the new week with two very different stories running at the same time.

The price trend is clearly weak: six consecutive weekly declines, a 4.1% year-to-date loss and continuing pressure from yields and the dollar.

Investor demand tells a less bearish story. More than 70 tonnes flowed into global gold ETFs during September even as the metal suffered one of its sharpest monthly declines in years.

The 3.7% third-quarter gain reinforces that distinction. Gold has experienced a substantial correction, but the latest data do not show investors abandoning the metal across the board.

For the near term, the decisive variables remain Treasury yields, the dollar and the Federal Reserve's response to weakening labor data and still-elevated inflation.

If yields begin to retreat as rate expectations soften, gold would lose one of its biggest current headwinds. If inflation or geopolitical developments drive rates higher again, however, the six-week correction could remain under pressure.

Market-data note: Gold price and investment-flow figures in this report are based primarily on World Gold Council market data. Past market performance is not indicative of future results.