Weekly start: hot US inflation keeps a December Fed hike in view for gold and silver

What happened

On the site's approximate India-equivalent prices, gold ended Friday, 30 October near ₹1,38,600 per 10 g, about 2.3% lower for the week and about 8% lower over the month. Silver fell harder, ending near ₹1,79,820 per kg, about 7.8% lower for the week and close to 20% down over the month.

Most of the damage came on Friday, when gold fell about 3% and silver about 6%. International gold closed near $3,899 an ounce, below the $4,000 mark. Prices steadied in early trading this week, with gold near ₹1,39,050 and silver near ₹1,83,100 on the site's latest reading.

Why

The main pressure is US interest rates. The US Federal Reserve held rates at 3.75–4% on 28 October, but two members voted for an immediate hike. A day later, data showed US inflation rising to 3.6% a year in September. Markets now see a December hike as likely: the CME FedWatch tool showed roughly a 75–85% chance in the last days of October.

US 10-year bond yields are still close to 5%. That makes gold and silver, which pay no interest, less attractive. High oil prices, linked to Strait of Hormuz tensions, add to inflation worries.

What could support prices

• Central banks are still buying gold. China added about 21 tonnes in September, its 23rd straight month of purchases.
• Many traders were already betting on lower gold in late October, which can set up quick rebounds.
• Indian wedding-season demand usually supports local buying on dips.
• Silver is now much cheaper compared with gold than at its January peak. The gold-to-silver ratio was near 79 on Friday.

What the numbers say

Both metals are below their 50 and 200-day averages, and silver is still oversold. The site's chance of a rise starts from how often each metal has risen over that period since 2017, then adjusts a little for today's news:

• Gold: about a 56% chance of being higher in a month. Short term, a bounce is likely; over 1–3 months the view leans higher, with about a 68% chance of a rise over 3 months.
• Silver: about a 51% chance of being higher in a month, close to even. Short term, a bounce is likely; over 1–3 months it is too close to call.

What to watch next

• US jobs and inflation data, which will shape the 9 December Fed decision.
• For gold, support is near ₹1,30,500 and a fall below it would point to more weakness. The trend only turns up above about ₹1,53,200.
• For silver, support is near ₹1,61,000. After falls like this, a relief move toward about ₹1,94,000 is the most common next step.