Gold prices declined in European trading on Friday, resuming losses after a brief pause the previous day, and neared a two-week low as the metal threatened to lose its footing above the key psychological level of $4,000 per ounce, heading for its first weekly loss since August.
The drop came as profit-taking and corrective moves accelerated from record highs, while a stronger US dollar ahead of key inflation data added further pressure. The upcoming inflation report is expected to provide clear signals on the Federal Reserve’s interest-rate path.
Price overview
• Today’s gold prices: Gold fell 1.9% to $4,047.64 an ounce, down from an opening level of $4,126.94, after hitting a session high of $4,144.39.
• On Thursday, gold gained 0.7%, marking its first increase in three sessions after rebounding from a two-week low of $4,004.56 per ounce.
Weekly performance
• Over the course of the week, which concludes with Friday’s close, gold prices are down about 5%, on track for their first weekly decline since August.
• This loss ends the metal’s longest winning streak since June 2020, which lasted nine consecutive weeks.
• The precious metal recorded its sharpest one-day drop in five years on Tuesday amid aggressive profit-taking from the all-time high of $4,381.73 per ounce.
US dollar
The US Dollar Index rose about 0.2% on Friday, extending gains for a second straight session and trading near a one-week high, reflecting continued strength against a basket of major and minor currencies.
Investors remain focused on the greenback as one of the most attractive assets at the moment, particularly with growing expectations that several major central banks — including those in the UK, Japan, Canada, and Australia — will move toward more accommodative policies to support their slowing economies.
US interest rates
According to CME’s FedWatch Tool, markets currently price a 97% probability that the Federal Reserve will cut rates by 25 basis points in its October meeting, versus a 3% chance of no change.
US inflation data
Traders await key US inflation data for September, scheduled for release later today, which could shape expectations for the Fed’s policy direction.
The Bureau of Labor Statistics confirmed last week that it will release the inflation report despite the ongoing government shutdown — now in its fourth week — to allow the Social Security Administration to calculate 2026 cost-of-living adjustments for millions of recipients.
Analysts do not expect the data to derail next week’s anticipated 25-basis-point rate cut but say it could provide clues on what the Fed may do in December.
The headline Consumer Price Index (CPI) is expected to rise 3.1% year over year in September, up from 2.9% in August, while the core CPI is forecast to remain steady at 3.1%.
Julien Lafarge, Chief Market Strategist at Barclays Private Bank, said: “It would take a major upside surprise to alter market expectations for another rate cut by the Fed.”
Gold outlook
• Peter Grant, Vice President and Senior Metals Analyst at Zaner Metals, said: “All the fundamental drivers that supported gold’s rally this year remain firmly in place.”
• He added: “We saw some opportunistic buying on Thursday’s dip, which helped prices recover amid ongoing trade and geopolitical tensions.”
SPDR holdings
Gold holdings at SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, were unchanged on Thursday, remaining at 1,052.37 metric tons.
