Gold Slides as Firmer US Inflation Lifts Dollar and Fed Hike Bets
Gold eased as US inflation rose faster than expected in October, lifting the dollar and raising bets on a Fed rate increase, Reuters reports.
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what happened
Gold prices edged lower on Thursday after US inflation came in stronger than forecast and hawkish remarks from Federal Reserve officials pushed the dollar close to a one-month high. According to Reuters, spot gold fell 0.2% to $3,979.09 an ounce, while December US gold futures dropped 0.4% to $3,984.50.
US inflation accelerated in October by more than expected, and traders sharply raised the odds of a half-point Fed rate hike next month. CME's FedWatch tool shows traders pricing a 100% probability of an increase in December. Higher rates raise the opportunity cost of holding bullion, which pays no yield.
Silver slipped 0.6% to $51.40 an ounce and palladium dipped 0.3% to $1,024.48.
why it matters
Gold is usually viewed as an inflation hedge, but rising rates tend to weigh more heavily on the metal because they make bonds and deposits more attractive. Remarks from Bank of England policymaker Megan Greene, who backed proactive tightening, also add to the hawkish backdrop.
market impact
Gold and silver: Fed rate bets and a stronger dollar pressure precious metals
- Gold pressure down — firmer Fed rate expectations and a stronger dollar reduce demand for non-yielding bullion
- US dollar pressure up — higher expectations for Fed rate increases support the greenback
tags
instruments
sources
- Gold slips as strong US inflation data bolsters dollar, Fed hike expectations — Reuters, 12 November 2026 at 00:50 UTC
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