Gold and silver prices in global markets decline after US inflation data
Quick Look
- When the September CPI data in the USA exceeded expectations and showed that inflation accelerated, the gold ounce price in the spot market decreased by 1.80% to 4,079 dollars, and the silver ounce price decreased by 5.71% to 55.79 dollars.
- The data increased concerns that the Fed might keep its interest rate policy tight, and investors turned from precious metals to bonds.
AI-generated summary
Why It Matters
Gold lost about a quarter of its value after breaking a historical record by exceeding $5,400 at the end of January. US inflation data affects market movements as an important indicator that directs interest rate policy expectations.
The ounce price of gold in the spot market decreased by 1.80 percent to 4 thousand 79 dollars as of 20.10 GMT today.
Thus, the precious metal fell below the support of $ 4,100, which is technically considered the critical threshold, and closed the third trading day in a row with a loss.
An ounce of gold lost approximately a quarter of its value in the period following the historical record it broke at the end of January, exceeding 5 thousand 400 dollars.
In parallel with this sharp decline in the precious metal, the ounce price of silver in the spot market decreased by 5.71 percent to $55.79.
US inflation increased interest rate expectations
Consumer Price Index (CPI) in the USA increased by 0.6 percent monthly in September, in line with expectations, and by 3.7 percent annually, above expectations.
Monthly inflation reached the highest level in the last 5 months, and annual inflation reached the highest level in the last 4 months.
The index related to gasoline prices increased by 9.1 percent on a monthly basis in September, accounting for more than half of the monthly increase in CPI. Core CPI, which does not include variable energy and food prices, increased by 0.3 percent on a monthly basis and 2.6 percent on an annual basis in September, more than expected.
Data indicating that consumer inflation is accelerating has triggered speculation that the US Federal Reserve (Fed) may continue to raise interest rates while weakening expectations of reducing or keeping the policy rate constant.
With this development, investors turned to government bonds instead of non-interest-bearing precious metals, and this suppressed the demand for gold.
Bond interest rates and dollar index rose
Following the data, the country's long-term bond interest rates rose rapidly. The US 10-year Treasury bond rate increased by 11 basis points to 5.33 percent, and the 30-year bond rate increased by 7 basis points to 5.63 percent. The dollar index, which shows the strength of the dollar in global markets, increased by 0.7 percent and reached its highest level since April 2025 at 102.87.
Analysts stated that the incoming data strengthened the predictions that the Fed could keep monetary policy tight for a longer time to return inflation to the target, and this created selling pressure on commodity markets.
What to Watch
AI outlook — possibilities, not facts
The Fed is likely to keep monetary policy tight to bring inflation back to target.
Likely · Within weeks
Open Questions
- What will the interest rate decision be like at the Fed's next meeting?
- How long will inflation remain at high levels?
- How will the strength of the dollar affect it long-term?
