Thursday brought the long-awaited revival to the precious?metals market. Gold, as if sensing weakness in the US dollar, moved back toward the psychologically important $4,420 per ounce mark. But early bulls should not celebrate yet: inflation reports due this week could be decisive for Fed policy, and the macroeconomic and geopolitical backdrop remains unsettled.

By Thursday morning, spot gold (XAU/USD) had gained 0.4%, trading at $4,418.87. Futures also posted modest gains to $4,461.82. Silver (XAG/USD) looked firmer, jumping 0.5% to $67.62, while platinum (XPT/USD) slipped to $1,889.34. The dollar index (DXY) meanwhile gave ground, easing to 98.74.

Why hasn't gold blasted off? The answer lies in US Treasury yields. An attempt by the government to buy $6 billion of long?dated debt did not save the market — yields moved higher. For gold, which pays no interest, rising yields are always something of a cold shower.

Commodity markets are adding to the nervousness. Brent crude crossed the $100/barrel psychological barrier for the first time since July, forcing investors to recall inflation risks.

Geopolitics is also keeping markets on edge. The Middle East conflict has entered its seventh month. Tehran has openly warned that if attacks on Iranian territory and infrastructure by the US continue, the region could see an escalation of even greater intensity. Investors must balance the long?term desire to "hide" capital in gold against near?term risks.

All eyes are now on the data calendar. Thursday brings the Producer Price Index (PPI), and Friday the Consumer Price Index (CPI). These reads will be the Fed's primary test. Market odds already price roughly a 65% probability that the Fed will raise the policy rate this month.

IG senior market analyst Tony Sycamore notes a paradoxical picture: gold rose to $4,402 overnight almost entirely on dollar weakness, despite the surge in bond yields.

However, Sycamore says the metal needs to clear the 200?day moving average around $4,537 to confirm a reversal and return to a broad uptrend (after the pullback from the $4,697 high).

While retail traders calculate bond yields, market makers are buying physical gold. According to the World Gold Council, August was historic: global gold ETFs attracted $18 billion (the second?largest inflow on record).

Physical holdings rose by 121 tonnes to an unprecedented 4,189 tonnes, and total assets under management jumped 16% to $615 billion. European funds posted an all?time record inflow, while North American funds recorded the third?largest inflow in history. Clearly, smart money is betting on the yellow metal.