Gold Trading Lower Again as the Dollar Strengthens After the U.S. Trade Deficit Fell to a 16-Year Low in October

09:34 AM EST, 01/08/2026 (MT Newswires) -- Gold prices weakened for a second day early on Thursday as the dollar rose after the United States reported its trade deficit narrowed to the lowest in 16 years in October.

Gold for February delivery was last seen down US$29.50 to US$4.433.00 per ounce, remaining under the Dec. 26 record high of US$4,552.70, but still up 5.1% over the past month and 65% over the past 12 months.

The price of the precious metal has been supported by rising geopolitical risk and physical demand from central banks and exchange-traded products (ETPs).

"With 2025 officially in the rearview and 2026 off to the races, we maintain our latest view in favor of gold's enduring strength amidst an ever-uncertain environment (Venezuela being the most recent example), which we expect to manifest in continued allocations by investors and central banks -- including those in the ETP space," Christopher Louney, a commodities strategist at RBC Capital Markets, wrote.

The dollar rose after the U.S. Bureau of Economic Analysis reported the country's October trade deficit narrowed to US$29.4 billion, the lowest since June, 2009, down from US$48.1 billion a month earlier and well below the consensus estimate for a deficit of US$58.4 billion, according to Marketwatch. The ICE dollar index was last seen up 0.2 points to 98.88 following the data.

Treasury yields also rose, with the U.S. two-year note last seen paying 3.503%, up 2.3 basis points, while the yield on the 10-year note last seen 2.6 points to 4.185%.

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