Gold rises as market nerves fray over U.S. midterms and Iran strikes

The dual pressures of the midterm elections and Middle East tensions have created a volatile landscape for precious metals. While gold found support as a safe haven, silver slipped to $50.290, reflecting its higher sensitivity to industrial demand and broader economic risks. Crude oil prices rebounded from Monday’s sharp slide, adding a layer of complexity to the inflation outlook as markets monitor whether rising energy costs will force the Federal Reserve toward further interest rate hikes.

Economic data continues to paint a picture of resilience, with the October ISM manufacturing index rising to 55.5. This sustained expansion supports the case for restrictive monetary policy, keeping the 10-year Treasury yield near 4.9%. As voters head to the polls, the possibility of a divided Congress has become a focal point for institutional investors, who are calculating how legislative gridlock might influence government spending and long-term Treasury issuance. Although historical trends suggest gold often performs well following midterm cycles, the immediate trajectory remains tethered to upcoming labor market reports and whether diplomatic efforts can stabilize the situation in the Strait of Hormuz.