Gold drops through Friday morning trading, hitting a four-month low, on rising oil prices, worsening inflation data and increased anticipation that the Federal Reserve will raise interest rates again sooner rather than later. Meanwhile, spot silver fell below $50 an ounce.
The latest release of the personal consumption expenditures price index—the Fed’s favorite inflation measure—on Thursday showed that inflation accelerated in September. The report came a day after the Fed decided to skip a rate hike this week and hold interest rates unchanged. The next policy meeting is in December. Rate hikes are considered bearish for gold, making it a less attractive alternate investment.
December gold fell 0.5% Thursday to settle at $4,031.40 an ounce on Comex, though the front-month contract gained 0.6% in the first four days of the week. Bullion is down 3.7% this month after dropping 6.6% last month and rising 9.1% in August. It’s down 7.1% so far this year after rallying 64% in 2025. The December contract is currently down $76.40 (-1.90%) an ounce to $3955.00 and the DG spot price is $3929.60.
Inflationary fears have climbed alongside oil prices since the start of the Iran war earlier this year.
Core PCE, which excludes volatile food and energy prices, rose 3.1% in September from a year earlier compared with 3% in August. The figure gained 0.3% month on month. The Fed has a 2% inflation target. Headline PCE rose 3.6% for the year, up from 3.4% in August, and increased 0.5% for the month.
The Fed on Wednesday kept interest rates at 3.75% to 4.00%, though the vote included two dissentions. More than 72% of the investors tracked by the CME FedWatch Tool are betting that the Fed will rase rates by 25 basis points in December, with the rest expecting rates to remain unchanged.
The Fed raised its benchmark rate by 25 basis points last month. It had previously kept rates unchanged this year after three previous rate cuts.
December silver futures lost 2.4% Thursday to settle at $52.38 an ounce on Comex, and the front-month contract retreated 2.9% so far this week. The most-active contract touched a record above $115 in January. Silver is down 14% this month after tumbling 9.6% in September and climbing 16% in August. It is down 26% so far this year after rising 141% in 2025. The December contract is currently down $2.525 (-4.82%) to $49.855 and the DG spot price is $49.58.
Spot palladium lost 1% Thursday to $1,011.00 an ounce and is down 3.9% so far this week. Palladium is down 17% this month after losing 11% in September and rallying 5.7% in August. It’s down 37% in 2026 after rising 74% last year. The current DG spot price is down $32.00 to $981.50.
Spot platinum fell 3.1% Thursday to $1,490.30 an ounce and has dropped 4.5% so far this week. Platinum is down 13% this month after falling 4.6% in September and increasing 7.5% in August. Platinum is down 27% so far this year after increasing 122% in 2025. The DG spot price is currently down $56.80 an ounce to $1437.70.
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