Gold traded close to $4,000 an ounce on Monday, rising briefly as oil prices eased, before slipping back in the evening. Investors are waiting for the US Federal Reserve's decision on Wednesday, and gold ETFs saw their first weekly net outflow in 14 weeks.
At a glance
- Spot gold rose to $4,014.49 in the morning but was back at about $3,995 by evening in India.
- Traders see a 9% chance of a US rate hike on Wednesday and an 80% chance in December.
- Gold ETF investors withdrew $3.01 billion last week while putting in $1.80 billion, led by US selling.
Background
Gold pays no interest, so it usually falls when investors expect higher interest rates and rises when rate fears ease. Oil matters because higher energy prices push up inflation, which makes rate hikes more likely. Gold exchange-traded funds (ETFs) hold physical gold for investors, and their weekly flows show whether big investors are buying or selling.
What happened
Spot gold rose 0.5% to $4,014.49 an ounce by 0924 GMT on Monday, Reuters reported, after falling to $3,975 on Friday, its lowest since July 20. The gain did not hold: by 7:30 pm in India, gold had slipped back to about $3,995, BusinessLine reported.
Lower oil prices gave gold some support. Brent crude fell about 2% to around $114 a barrel after hitting a six-month high last week, easing some inflation worries.
Why the Fed matters this week
The Federal Reserve ends its policy meeting on Wednesday, October 28. Traders see only a 9% chance of a rate hike then, but an 80% chance in December, according to CME's FedWatch tool. Higher rates make gold, which earns no interest, less attractive to hold.
"This 4,000 level is seen by some as a buying opportunity," said UBS analyst Giovanni Staunovo. He said gains are likely to stay limited while the Fed may keep raising rates.
Investors pull money from gold funds
Gold ETFs saw net outflows last week for the first time in 14 weeks, World Gold Council data reported by BusinessLine show. Investors redeemed $3.01 billion and put in $1.80 billion, with US investors withdrawing $1.7 billion. Funds in the UK, Switzerland, Germany and China still drew new money.
So far this year, Chinese investors have added $10.43 billion to gold ETFs, the UK $10.22 billion and India $4.69 billion, the third-largest amount.
What it means for India
Gold is now more than 25% below its January 29 record of $5,608, just as the Dhanteras and Diwali buying season begins. Indian dealers expect festive demand to cushion further falls, but the Fed decision and US inflation data on October 29 will set the near-term direction.
Our read
Outlook: neutral. Easing oil and buying near $4,000 support gold, but ETF outflows and an 80% chance of a December hike limit any rebound.
What to watch
- The Fed's decision on October 28 and any signal about a December hike.
- US PCE inflation data due on October 29.
- Whether gold ETF flows stay negative after the first outflow week in 14.
For information only, not investment advice.
Gold price in India
metalscost.com India reference price as of 2026-11-05.
Detailed analysis
Timeline
- 2026-10-23: Gold falls to $3,975, its lowest since July 20, ending its worst week since June.
- 2026-10-26: Gold briefly climbs back above $4,000 as oil eases, then slips back.
- 2026-10-28: The US Federal Reserve announces its policy decision.
- 2026-10-29: US PCE inflation data is released.
Demand Drivers
ETF investors turned net sellers last week, led by $1.7 billion of US redemptions.
Inflation
Brent's fall to about $114 eased inflation fears slightly and gave gold some support.
Interest Rates
An 80% chance of a December Fed hike is limiting gold's recovery from its three-month low.
What could lift prices
- UBS says some investors see $4,000 as a buying opportunity.
- Festive buying in India around Dhanteras and Diwali could support demand.
What could weigh on prices
- Traders still put the odds of a December Fed hike at 80%.
- Gold ETFs had their first net outflow in 14 weeks, led by US investors.
Country impact
| Country | Impact | Reason |
|---|---|---|
| United States | High | The Fed decision and US ETF selling are driving gold this week. |
| India | Medium | Lower gold prices arrive at the start of the Dhanteras and Diwali buying season. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Jewellery | Positive | Gold more than 25% below its record could lift festive jewellery buying. |
| Asset Management | Negative | Gold ETFs saw net outflows for the first time in 14 weeks. |
Who gains, who loses
- Festive gold buyers in India: Gold is more than 25% below its January record ahead of Dhanteras.
- Investors who bought gold near its January peak: Gold has fallen more than 25% from its record of $5,608.
Other ways this could play out
- If the Fed signals no December hike, gold could move clearly back above $4,000.
- If oil rises again and the Fed sounds hawkish, gold could fall to new three-month lows.
Price risks
- Further attacks on oil supplies could lift oil prices and rate-hike bets again.
- Continued ETF outflows from US funds could add selling pressure.
Historical comparison
- January 29, 2026: Gold set a record high of $5,608 an ounce, more than 25% above today's level.
Technical view
Price is mixed relative to its 20-period and 50-period moving averages, showing no clear trend alignment.
Computed from metalscost.com's own stored price history.
United States
India