Gold rose more than 1% on Thursday, recovering from a one-week low hit after hot US inflation data, as the dollar slipped from an 18-month high and traders scaled back bets on an October Fed rate hike.
At a glance
- Spot gold rose 1.3% to $4,158.63 an ounce, Reuters data showed.
- The dollar index fell 0.1% to 102.06, giving back most of its post-inflation gains.
- San Francisco Fed President Mary Daly signalled no need for a hike at the October 27-28 meeting.
Background
Gold pays no interest, so it tends to fall when traders expect higher interest rates and rise when those expectations fade. It is priced in dollars, so a weaker dollar makes it cheaper for buyers using other currencies. September's US consumer price data, released on Wednesday, came in hotter than expected.
What happened
Spot gold rose 1.3% to $4,158.63 an ounce on Thursday, after hitting its lowest level since October 7 in the previous session, Reuters data cited by Moneycontrol showed. US gold futures for December delivery rose 1.8% to $4,180.
Silver was flat at $55.53 an ounce, and platinum and palladium were little changed.
Why gold bounced
The dollar slipped from an 18-month peak as cautious remarks from Fed officials and lower Treasury yields led traders to scale back bets on an October rate hike. The dollar index fell 0.1% to 102.06, giving back most of the gains it made after the inflation data.
San Francisco Fed President Mary Daly said the Fed will probably need to raise rates further but signalled no need for a hike at its October 27-28 meeting. The probability of an October hike stood at about 32% early on Thursday, up from 22% before the data, according to CME's FedWatch tool.
What it means
The bounce follows a sharp drop. US consumer prices rose 0.6% in September, the fastest monthly rise since April, driven by energy costs, which had pushed gold to a one-week low.
The rebound is fragile while a rate hike remains possible this year. Traders now turn to US producer prices and retail sales data due on Thursday for the next signal.
Our read
Outlook: neutral. A weaker dollar supports gold, but the chance of another Fed rate hike this year limits how far it can recover.
What to watch
- US producer price and retail sales data due on Thursday.
- Fed commentary ahead of the October 27-28 meeting.
- The dollar's move after its 18-month high.
For information only, not investment advice.
Gold price in India
metalscost.com India reference price as of 2026-10-16.
Detailed analysis
Timeline
- 2026-10-14: Hot US CPI pushes gold to its lowest since October 7.
- 2026-10-15: Gold rebounds 1.3% as the dollar eases.
Inflation
September CPI rose 0.6% on the month, the fastest since April, on energy costs.
Interest Rates
October rate-hike odds rose to about 32% after the CPI data, but Fed comments tempered them.
Currency Impact
The dollar index slipped to 102.06 from an 18-month high, supporting gold.
What could lift prices
- A weaker dollar makes gold cheaper for overseas buyers.
- Fed officials signalled no hike is needed at the October meeting.
What could weigh on prices
- Another Fed rate hike this year remains likely.
- Strong producer prices or retail sales could revive hike bets.
Country impact
| Country | Impact | Reason |
|---|---|---|
| United States | High | Its inflation data and Fed outlook are driving gold. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Bullion Trading | Positive | Prices recovered part of Wednesday's losses. |
Who gains, who loses
- Gold investors: Prices recovered part of the previous day's drop.
- Dollar bulls: The dollar gave back most of its post-CPI gains.
Other ways this could play out
- If Thursday's data is soft, gold could extend its rebound.
- If producer prices surprise higher, gold could slip back toward its one-week low.
Price risks
- Stronger US data could revive October rate-hike bets.
- A renewed dollar rally would weigh on gold.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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