Commodities
Gold slips below $4,000 and heads for its worst week since June as oil revives Fed hike bets
Spot gold fell about 4% on the week as an oil rally pushed traders toward pricing a December Fed rate increase, and margin calls from the tech selloff added to the selling.
HedgeWeekly News Desk ·
Gold dropped below $4,000 an ounce on Friday for the first time since mid-July, leaving the metal on course for its worst week since June as higher oil prices pushed traders toward pricing a Federal Reserve rate increase. Spot gold was down 0.6% at $3,998.35 at about 11:20 a.m. New York time, Reuters reported, after touching a session low of $3,975.23, and was down about 4% for the week. US December gold futures settled 1.3% lower at $4,007.90.
Energy set the tone. Brent climbed to its highest level in more than five months after Houthi attacks in Saudi Arabia raised fears of supply disruption, having already settled 4% higher at $113.17 a barrel on Thursday. Analysts said a sustained oil rally keeps inflation pressure alive and real interest rates high, which raises the cost of holding a metal that pays no yield. US consumer prices rose 0.6% in September from August and 3.7% from a year earlier.
Part of the selling came from outside the bullion market. Jim Wyckoff of American Gold Exchange said margin calls from the tech-stock selloff led equity investors to sell gold and silver, as the S&P 500 and Nasdaq touched five-week lows. Silver fell 1% to $53.97, its lowest since November 2025, platinum lost 0.9% to $1,555.84 and palladium slipped 0.5% to $1,048.31, with all three set for weekly losses. Lower prices drew more buying in India during Dussehra, while Chinese physical demand held steady.
Why it matters: rate expectations, not geopolitical risk, are driving gold for now. CME FedWatch put the chance of no change at the Fed's October 27-28 meeting at 92% and the probability of a December hike at 78%, and the PCE inflation report due October 29 is the next test of that pricing. At around $4,000, gold sits roughly 29% below its record of $5,595 set on January 29, and this week it fell alongside equities during a combined oil and tech shock, giving multi-asset portfolios little cushion.
Sources
- MINING.COM (Reuters): Gold price set for steep weekly loss as rising oil prices bolster Fed rate hike bets
- Asharq Al-Awsat: Gold heads for steep weekly loss as oil prices fuel Fed rate concerns
- TokenPost: Gold is down 3.5% this week, its steepest drop since June
- Finance Magnates: Gold falls below $4,000 (June 2026, record-high reference)