Gold loses 4% for the week as Brent rises to $116.72 a barrel

Key Facts

Gold fell below $4,000 an ounce on October 23, heading for a 4% weekly loss in its worst performance since June, as oil prices rose and inflation concerns resurfaced. Reuters said in an update at 15:20 GMT that spot gold was down 0.6% at $4,000.59 an ounce after touching $3,975.23, the session low. The metal had fallen below the $4,000 threshold for the first time since mid-July. This followed an earlier Reuters report during the session, at 09:36 GMT, which put gold at $4,026.15 after a low of $3,986.50. The earlier report estimated the weekly loss at 3.5%, while the decline reached 4% in the later update.

An Investing.com snapshot at 12:14 GMT showed spot gold down 0.4% at $4,007.92 an ounce, with an expected weekly loss of more than 3.7%. Gold futures fell 0.9% to $4,022.10 an ounce and were heading for a weekly loss of 3.8%. EL7 closing data, meanwhile, put the gold contract at $4,181.1 on October 16 and $4,007.9 on October 23. The same data showed spot gold at $4,165.42 and $3,995.81 on those dates, respectively. These prices reflect closing levels or snapshots taken at different times during the session, while spot gold’s low was $3,975.23 in the later Reuters update.

Gold’s decline came alongside a rise in oil, with Brent crude gaining 3.1% to settle at $116.72 a barrel on October 23, after standing below $97 at the start of the month. The Associated Press said the settlement level was the highest since June 2022. Rising energy prices have revived concerns that oil costs will feed into inflation, potentially limiting central banks’ ability to cut interest rates quickly. Hammad Hussein, climate and commodities economist at Capital Economics, said higher oil prices “could lead to real interest rates remaining elevated for longer,” reducing the relative appeal of investing in and holding gold. Market analyst Jim Wyckoff said heightened inflation concerns make major central banks less able to ease policy as quickly as they would like, adding that this puts pressure on gold and silver.

Oil pressures had already appeared in September data: the U.S. Energy Information Administration said the average spot price of Brent crude was $114 a barrel, up $23 from August. The agency linked the increase to an escalation in attacks on oil infrastructure and tankers in the Middle East. It said attacks temporarily halted flows through the Saudi East-West Pipeline, while Brent’s daily price reached $131 on September 15. In its September meeting minutes, the Federal Reserve said short-term inflation compensation had risen between meetings, “largely reflecting movements in oil prices.” It said, however, that market-based and survey measures of longer-term inflation expectations remained stable at levels consistent with the committee’s 2% goal.

The Fed minutes said nominal yields rose about 35 basis points across the two- to 10-year maturities between the September meetings, attributing part of the move to a higher expected path for monetary policy and stronger economic data. The central bank had raised its target interest-rate range by a quarter of a percentage point to 3.75%–4.00% at its September 15 and 16 meeting. In Reuters’ latest poll, a near-consensus of economists expected no rate increase at the October meeting, with an increase in December considered likely. CME Group’s FedWatch tool showed a 90% probability of a rate increase in December, while the lowest estimate for the probability of an October increase was 15%. These are market probabilities and expectations, not a decision by the Fed.

Attention is turning to the Federal Open Market Committee meeting on October 27 and 28, with a news conference scheduled for October 28. The U.S. Bureau of Economic Analysis has also set October 29 at 8:30 a.m. U.S. local time for the release of September personal income and spending data. The data include the Personal Consumption Expenditures measure that the Fed tracks to monitor inflation. In its October outlook, the Energy Information Administration estimated the average spot price of Brent at $105 a barrel in the fourth quarter of 2026, up $14 from the previous month’s estimate. The estimate was based on the assumption that constraints on oil flows from the Middle East would continue through the quarter.