Gold falls 2.7% to $3,910.53 as oil rises and inflation fears mount
Key Facts
Spot gold fell 2.7% to $3,910.53 an ounce at 14:05 GMT on October 30, its lowest level since October 2025, according to Reuters coverage. U.S. gold futures for December delivery fell 2.8% to $3,919.60 an ounce. The decline came as oil rose and data showed U.S. inflation persisting, reinforcing concerns that interest rates would remain high. The precious metal was on track for a second consecutive monthly loss, down 5.9% in October through the time of the report. At the close on the same day, EL7 data showed gold XAUUSD at $3,898.82, compared with $4,020.565 the previous day.
Data from the U.S. Bureau of Economic Analysis showed the personal consumption expenditures price index rose 0.5% in September from the previous month. The index is the measure the Federal Reserve follows to assess inflation. The core index, which excludes food and energy, rose 0.3% during the month. On an annual basis, the headline index increased 3.6% in September, while the core index rose 3.1%. These readings put inflation at the forefront of the monetary-policy backdrop as energy prices climbed. The continued annual increases in both indexes give policymakers additional data as they balance inflation against economic activity.
On the activity front, U.S. real gross domestic product grew at an annual rate of 3.4% in the third quarter, after growth of 2.2% in the second quarter, according to the Bureau of Economic Analysis' advance estimate. The bureau said the increase reflected higher investment, consumer spending and government spending. A decline in exports offset some of these contributions, while imports rose. The Federal Reserve described economic activity in its October statement as expanding at a “solid pace” and said domestic spending had remained resilient despite ongoing uncertainty related, in part, to geopolitical developments. The data highlight a dilemma for the central bank: accelerating economic growth alongside persistent annual inflation.
On October 28, the Federal Reserve kept its target interest-rate range at 3.75% to 4%, following a 10-to-2 vote. The two dissenting members preferred to raise the range by a quarter of a percentage point. The decision comes amid strong inflation and economic activity data, while higher energy costs increase the risk that price pressures will persist. The Fed said uncertainty remained elevated because of geopolitical developments, alongside resilient domestic spending. The next Federal Open Market Committee meeting is scheduled for December 8 and 9, after the release of a new U.S. reading on personal income and spending.
Brent crude futures for December rose 2% to $117.14 a barrel, while West Texas Intermediate gained 1.9% to $103.94 at 12:36 GMT on October 30, according to Reuters. Both benchmarks were on track for a fourth consecutive monthly gain; the report estimated Brent would finish October up 13% and WTI up 15%. Developments in the Strait of Hormuz underscored supply risks after a tanker was struck by explosive devices attached by a small boat, according to the United Kingdom Maritime Trade Operations centre, as reported by Reuters. Responsibility for the attack was not immediately clear. The report described the incident as the first known successful strike using limpet mines in the waterway since the U.S.-Iran war began in February.
Reuters noted that a decline in technology shares may have added pressure on metals, as Commerzbank analysts said the sharp drop may have triggered forced selling and margin calls. Physical gold demand also remained weak in major Asian markets during the week. Buyers in India postponed purchases while waiting for prices to fall further, while demand in China remained limited. EL7 data showed the GCUSD close at $3,913 on October 30, after $4,031.4 on October 29. The U.S. personal income and outlays report for October is due on November 25, 2026, at 8:30 a.m. Eastern Time, ahead of the Fed's next meeting in December.