By Sukanya Mitra
Nov 4 (Reuters) - Gold prices rose on Wednesday, supported by a softer US dollar after Democrats scored early wins in the US midterm elections, while investors awaited the non-farm payrolls data later this week for clues on the Federal Reserve's policy path.
Spot gold was up 0.5% at $3,947.49 per ounce by 0415 GMT, while US gold futures for December delivery rose 0.5% to $3,958.00.
"A weaker USD and a punchy decline in both nominal and real US Treasury yields are clearly providing support
for gold," said Chris Weston, head of research at Pepperstone.
Additionally, "the demand for protection against a potentially more unpredictable and confrontational Trump administration looks to be providing a compelling backdrop for gold buyers," Weston added.
US stock futures slumped, Treasuries rallied and the dollar softened on Wednesday as Democrats notched early Senate wins, raising the prospect of a blue sweep in the US midterm elections in a major setback to President Donald Trump and Republicans. [MKTS/GLOB] [USD/] [US/]
On the geopolitical front, Iran and the United States are still far from a deal to end their war, a senior Iranian official told Reuters on Tuesday, as Trump declined to rule out resuming US combat operations after the elections.
Traders currently see a 78% chance that the Fed will raise rates in December, according to CME's FedWatch tool. Higher interest rates increase the opportunity cost of holding non-yielding bullion, reducing its appeal to investors.
Markets now await the US non-farm payrolls report due on Friday.
"$4,000 is the obvious resistance level — and a break (on) either side of that range could dictate gold's next decent move," said Matt Simpson, senior market analyst at StoneX.
India's gold demand is expected to fall to a six-year low in 2026, as elevated prices weigh on jewellery sales and investment demand moderates, the World Gold Council (WGC) said on Tuesday.
Among other metals, spot silver fell 0.8% to $49.38, platinum slipped 1.2% to $1,399.72 and palladium dropped 0.2% to $932.07.
(Reporting by Sukanya Mitra in Bengaluru; Editing by Subhranshu Sahu and Janane Venkatraman)
