Gold jumps bringing spot prices back near $4400 an ounce, following this morning’s inflation report, as persistent geopolitical and inflationary risks sparked safe haven investing.
The consumer price index for August rose a seasonally adjusted 0.4%, putting the 12-month increase at 3.4%, per the Bureau of Labor Statistics, putting both readings in line with the Dow Jones consensus forecast.
This morning’s data follows yesterday’s U.S. producer price index that showed August’s inflation rose the most in three months because of high energy prices. These reports combine to raise speculation that the Federal Reserve will raise interest rates at its meeting next week to curb surging inflation. Oil prices also surged this week, adding to inflationary pressure and the speculation of a Fed rate increase.
December gold futures fell 1.2% Thursday to settle at $4,407.30 an ounce on Comex. The front-month contract lost 1.6% so far this week. Bullion rose 9.1% last month after gaining 1.7% in July, its first monthly increase since February, and sliding 12% in June. It decreased 7% in the first half of 2026 after rallying 64% last year. The December contract is currently up $27.60 (+0.63%) an ounce to $4439.50 and the DG spot price is $4391.10.
The surge in the PPI comes at the same time that hostilities between the U.S. and Iran have intensified, triggering further fears of oil supply disruptions around the critical maritime chokepoint, the Strait of Hormuz.
Headline PPI rose 0.4% last month from July—the most since May—and was up 5.4% from a year earlier, the data showed. But excluding volatile food and energy prices, core PPI increased 0.2% for the month and 4.6% year on year.
The Fed closely watches inflation and labor market data when setting monetary policy. Last week, the closely watched U.S. monthly jobs report showed hiring was unexpectedly strong in August, signaling that the labor market may be resilient enough to tolerate a rate hike.
More than 83% of investors tracked by the CME FedWatch Tool are now betting that the Fed will raise interest rates by 25 basis points at its policy meeting next week, that’s up 10% from just yesterday, while the rest are expecting rates to remain unchanged at 3.5% to 3.75%. The Fed has kept interest rates unchanged this year after three previous rate cuts.
The European Central Bank on Thursday raised its key rate to 2.50% in its second rate increase this year and warned that inflationary pressures won’t be going away soon.
December silver futures decreased 5.4% Thursday to settle at $64.93 an ounce on Comex. The front-month contract is down 2.7% this week. The most-active contract touched a record above $115 in January. Silver climbed 16% last month after sliding 3.6% in July and declining 21% in June. It lost 15% in the first half of 2026 after rising 141% last year. The December contract is currently up $0.588 (+0.91%) an ounce to $65.515 and the DG spot price is $65.08.
Spot palladium declined 6.1% Thursday to $1,292.50 an ounce, and it’s down 7.2% so far this week. Palladium rallied 5.7% last month after adding 5.8% in July and dropping 11% in June. It retreated 25% in the first half of 2026 after rising 74% last year. Currently, the DG spot price is up $40.80 an ounce to $1328.50.
Spot platinum tumbled 6% Thursday to $1,802.40 an ounce. It retreated 1.2% so far this week. Platinum rose 7.5% last month after gaining 6.6% in July and tumbling 19% in June. Platinum slid 23% in the first half of 2026 after increasing 122% in 2025. The DG spot price is currently up $17.80 an ounce to $1817.50.
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