Gold Futures Set Yearly Low at $3,879.30 an Ounce
Key Facts
U.S. gold futures for December delivery set a new 2026 low of $3,879.30 an ounce during trading on Friday, October 30, before ending the session at $3,898.90, according to FXStreet. The decline came on a day when gold faced pressure in the markets as inflation concerns intensified and interest rate expectations shifted. Reuters reported earlier in the session that spot gold fell 1% to $3,980.40 an ounce at 1107 GMT. At the same time, U.S. December futures fell 1% to $3,991.10, according to a Reuters report published via Kitco. These spot and futures prices show different levels because they refer to different instruments and observation times.
Reuters attributed the pressure to U.S. gross domestic product growth in the previous quarter exceeding expectations, alongside accelerating inflation in September. These developments raised concerns that elevated inflation would keep monetary policy tight, while expectations of a December rate hike increased. Higher rate expectations weigh on gold by increasing the appeal of yield-bearing assets, according to the report's account linking the metal's move to those expectations. Oil prices also rose and were heading for a fourth consecutive month of gains, while an attack on a tanker in the Strait of Hormuz highlighted supply risks. Rising energy prices brought inflation concerns back to the fore, as gold faced pressure from the prospect of monetary policy remaining tight.
The Federal Reserve and the European Central Bank held interest rates unchanged during the week, but signaled that monetary tightening cycles may not be over, according to Reuters. The report linked these signals to inflation risks arising from higher energy costs. At its October meeting, the Fed kept its target rate range at 3.75% to 4.00%, in a 10-2 vote, according to Kitco. Two members dissented, favoring a 25-basis-point increase. The Fed said that "inflation remains elevated" and that holding off on a rate increase allows "more information to accumulate," according to the meeting statement cited by the Associated Press.
The decline extended to the spot market, with Kitco reporting that gold reached $3,880 an ounce, down 3.5% on the day. The drop came as the dollar and bond yields were falling, an unusual move because their weakness is typically considered supportive of gold, according to Kitco. The outlet quoted an analyst as saying that a selloff in technology shares on Friday triggered broader liquidations across markets. He added that the liquidation weighed on precious metals and overshadowed safe-haven demand. Meanwhile, gold had fallen to its lowest level since mid-July, according to Reuters, while the metal was down 4.3% since the start of October and heading for a second consecutive monthly loss.
EL7 data showed that December gold futures closed at $3,913.6 on November 2, after settling at $3,898.9 on October 30. Commenting on the outlook, UBS analyst Giovanni Staunovo said gold could reach $5,000 or more next year, as he expected the Fed eventually to cut rates and inflation to recede as a concern. This remains the analyst's view for next year, while investors await new U.S. economic data. The October jobs report is scheduled for release on November 6, 2026, at 8:30 a.m. U.S. Eastern Time, according to the U.S. Bureau of Labor Statistics schedule.