Gold Surges Above $4,000 as Democrats Seize Congress, Treasury Yields and Oil Prices Fall

Spot gold and silver jumped sharply in late U.S. trading on Wednesday, with gold near $4,065.90 an ounce, up $136.50 (3.47%), and silver around $52.28, up $2.61 (5.25%). The rally followed Democrats’ sweeping victories in the midterm elections, which gave them control of the House and Senate and prompted a sell-off in the dollar, Treasury yields and crude oil.

"The election results handed Democrats control of both chambers of Congress, raising expectations for legislative gridlock and potentially more restrained fiscal spending during the remainder of President Donald Trump's term," the report said.

Treasury markets reacted quickly, pushing the benchmark 10-year yield down to about 4.89%, its lowest in nearly two months, before settling near 4.88%. The two-year yield fell to roughly 4.55% and the dollar weakened against major currencies. Lower borrowing costs and a softer dollar provided immediate support for gold, while the broader decline in yields also helped silver.

U.S. economic data released that day showed mixed signals: ADP reported 86,000 private-sector jobs added in October, beating expectations, while the Institute for Supply Management services index slipped to 54.5, still in expansion territory but below forecasts. The September trade deficit narrowed slightly to $105 billion as exports rose 1.9%.

Crude oil prices plunged, with Brent futures down about 8.7% to $94.62 a barrel and WTI near $88.12, reflecting reduced expectations of further escalation in the Strait of Hormuz and hopes for renewed U.S.–Iran diplomatic talks. The lower energy prices eased inflation concerns and added to the bullish backdrop for precious metals.

U.S. equity markets closed sharply higher, led by a 3.0% jump in the Dow Jones Industrial Average, while the S&P 500 and Nasdaq also posted gains. Canadian and European indices rose as well, buoyed by the rally in gold and the decline in oil prices.

Analysts noted that gold’s next technical hurdle is breaking the $4,068.17 resistance level, with a sustained move above that target potentially opening a path toward $4,200. Silver faces resistance near $52.85 and could aim for $55 if momentum continues.