Gold falls below US$4,000 as traders assess inflation, Fed remarks

GOLD slipped, extending losses triggered by a high US inflation print and hawkish remarks from Federal Reserve officials that reinforced expectations of a December rate hike.

Bullion fell as much 1.2 per cent to trade below US$4,000 an ounce during US hours, as the dollar hit the highest since May 2025. While cash trading in Treasuries was closed for Veterans’ Day, futures suggested a retreat is set to continue as faster-than-expected inflation data cemented wagers on more aggressive Fed hikes. 

Traders are now fully pricing in a quarter-point hike next month, with a small chance of a half-point move. Higher borrowing costs weigh on gold as it doesn’t pay interest, while a stronger greenback makes it more expensive for most buyers. 

Despite the headwinds, the precious metal has mostly held above US$4,000 an ounce, suggesting buyers see this as a key level of support. Central-bank buying also remains intact, even as persistent inflation and expectations for tighter monetary policy cloud the near-term outlook. 

“Prices have held up well despite the equity market correction as gold appears to be shifting away from its role as a liquidity provider,” Suki Cooper, global head of commodities research at Standard Chartered, wrote in a note. 

Meanwhile, Federal Reserve Bank of Chicago President Austan Goolsbee called the October consumer price report “borderline disturbing” in a Tuesday interview on PBS Newshour.

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“We’ve got a real inflation issue on our hands that has been developing and we’re going to have to deal with that,” he said.

Gold fell 1 per cent to US$3,984.15 an ounce as of 3.06 pm in New York. Silver was up 0.5 per cent at US$51.78 an ounce, after falling earlier in the session. Platinum fell and palladium rose. The Bloomberg Dollar Spot Index, a gauge of the US currency, was up 0.4 per cent. BLOOMBERG