Gold futures on the New York Mercantile Exchange climbed sharply on Tuesday, buoyed by dovish remarks from a key Federal Reserve official. The most-active December 2026 contract settled at $4,520.2 per ounce, up $105.7, or 2.39%, for the session.

The rally was fueled by comments from Fed Governor Christopher Waller, who indicated a willingness to hold interest rates steady at the upcoming September policy meeting if forthcoming data continue to show easing inflation pressures. Waller, who had previously been vocal about elevated inflation, also noted that rate hikes remain on the table should price pressures re-emerge. Following his remarks, market pricing for a September rate hike cooled notably, with the implied probability dropping to roughly 50% from 63.2% in the prior session.

Economic data released during the day painted a mixed picture. The Labor Department reported that initial jobless claims for the week ending August 29 rose to 206,000 from 204,000, slightly exceeding the 205,000 consensus forecast among Wall Street economists. Meanwhile, the Institute for Supply Management's (ISM) services purchasing managers' index (PMI) for August came in at 55.4, up from 54.1 in July and above the anticipated 54.3, signaling continued robust expansion in the services sector. Investors are now turning their attention to the August nonfarm payrolls report, due for release on Wednesday.

In a separate development, the World Gold Council reported that central banks added to their gold reserves in July, with net purchases reaching 23 tonnes. Sprott Physical Gold Trust saw its shares trade higher in tandem with the broader precious metals complex. Analysts at Societe Generale noted in a recent market update that gold, after a sharp pullback, has rebounded to near the $4,500-per-ounce level and that bullish sentiment appears to be reviving.

Silver also posted significant gains, with December delivery futures rising $2.122, or 3.24%, to settle at $67.585 per ounce.