Gold prices experienced a decline on Friday, positioning themselves for the most significant weekly drop in over four months. This movement was influenced by rising oil prices and robust US economic data, which heightened expectations that the Federal Reserve would maintain elevated interest rates for an extended period. Spot gold experienced a decline of 0.1%, trading at $4,018.69 per ounce as of 0036, marking its lowest point since August 3. The metal experienced a decline of 3.4% for the week to date, marking its most significant weekly drop since June.
US gold futures for December delivery decreased by 0.6%, settling at $4,033.70. Oil prices increased approximately 4% to reach a five-month peak on Thursday, following Houthi attacks in Saudi Arabia that heightened worries regarding potential disruptions to energy supplies. Elevated energy prices strengthen expectations for prolonged higher interest rates from the Fed, thereby raising the opportunity cost associated with holding non-yielding bullion. The number of Americans filing new claims for unemployment benefits decreased to levels not seen in nearly 57 years last week, indicating a slight increase in job growth for October.
Attention is now directed toward the Federal Reserve’s policy meeting scheduled for October 27-28, alongside the upcoming release of Personal Consumption Expenditures data. This metric is a crucial indicator monitored by the central bank in its pursuit of a 2% inflation target. Traders are assigning a probability of merely 7% to the likelihood of an interest rate increase next week, while the anticipation for a hike in December persists at a robust 81%. India has granted permits for the importation of approximately 6,500 metric tonnes of silver over the forthcoming six months, as the leading global consumer of this precious metal aims to satisfy demand during the festive season, according to four bullion dealers who obtained the permits.
HSBC revised its average price forecasts for platinum and palladium for 2026 in a research note released on Thursday, attributing the adjustments to changing market fundamentals and investor liquidation. The report also indicated that both metals possess potential for recovery. Among other metals, spot silver edged 0.1% lower to $54.46 per ounce, platinum slid 0.4% to $1,563.67, and palladium dropped 0.5% to $1,051.00. All three metals are on track for weekly declines.
