October 16, 2026
Gold prices are heading to record a weekly loss, affected by traders’ assessment of the possibility of the Federal Reserve (the US central bank) making further increases in interest rates this year, following a series of US inflation data that came higher than expected.
In spot transactions, gold fell by 0.1% to reach $4,165.12 per ounce by 18:07 GMT, achieving a weekly decline of 0.7%. On the other hand, US gold futures for December delivery rose by 0.3% to reach $4,181.10 per ounce.
In this context, Bart Melek, head of global commodities strategy at TD Securities, said: “We are moving in a very limited range, and tending towards minimum support, and the main reason for this is that there is still a great deal of ambiguity about what the Reserve Board will decide.”
For his part, Federal Reserve Chairman Kevin Warsh expressed his optimism about the strength of the US economy, without providing any clear indications about the future path of interest rates. This comes after data last Thursday showed that producer prices in the United States recorded their largest increase in four and a half years last month, in preparation for the consumer prices report issued on Wednesday, which revealed an acceleration in inflation rates in September.
In the same context, Austin Goolsby, head of the Chicago branch of the Federal Reserve, described the data as “disappointing,” while Beth Hammack, head of the Cleveland branch, indicated that the central bank may have to raise interest rates more rapidly if there is a noticeable deterioration in the public’s expectations for inflation.
Data from the CME Group’s Fed Watch tool indicate strong odds of keeping interest rates unchanged this month, with 90% expectations of addiction to raising them in December. Although gold is considered a traditional tool to hedge against inflation, high interest rates reduce the attractiveness of the precious metal, which does not generate a return.
“Gold prices are likely to decline gradually over the remainder of this year, as the Fed continues to raise interest rates and concerns about the end of the AI boom prove temporary,” said Hamad Hussein, climate and commodities economist at Capital Economics.
Geographically and in other markets, gold traded at a premium in India this week for the first time in more than three months, supported by lower prices that stimulated jewelry purchases. As for other precious metals, silver fell in spot transactions by 0.7% to record $57.05 per ounce, while platinum stabilized at $1626.15, and palladium fell by 1.1% to reach $1113.61, with the three metals collectively heading towards recording weekly losses.
