Gold slipped below the $4,000 mark on Friday, October 30, as higher oil prices and a stronger-than-expected US inflation reading strengthened expectations that the Federal Reserve could raise interest rates again before the end of the year, Reuters reported.

Source: Reuters via TradingView

Spot gold was down 0.6% at $3,997.39 an ounce by 0255 GMT on Friday, while US gold futures for December delivery also fell 0.6% to $4,007.80 an ounce. Bullion had shed 1.1% in the previous session and is on track for a second consecutive monthly decline, with prices down about 3.5% so far in October.

The latest pressure followed US data released on Thursday showing the personal consumption expenditures (PCE) price index rose 0.5% last month, the biggest increase since March. The Federal Reserve has left the door open for an interest-rate hike before year-end to rein in stubborn inflation, and traders are now pricing in roughly a 75% chance of a December rate hike, according to CME's FedWatch Tool.

$3,997.39Spot gold per ounce, down 0.6% Friday
$115+Brent crude per barrel
~$103WTI crude per barrel
+0.5%US PCE price index last month, most since March

Oil moved the other way. Brent crude advanced above $115 a barrel after swinging more than $3 in the previous session, while West Texas Intermediate traded near $103, as concerns grew over a possible resumption of US military strikes against Iran and Yemen's Houthi forces stepped up attacks linked to Saudi Arabia, stoking supply worries. Oil is on track for a fourth straight monthly gain.

Source: Moneycontrol via TradingView

Other precious metals also weakened. Silver slid 0.4% to $51.94 an ounce and is down about 14% so far this month, while platinum and palladium also edged lower.

Yaani — in easy terms

Gold at $3,997 an ounce, at about Rs 95.18 to the dollar, works out to roughly Rs 3.80 lakh per ounce — yaani kareeb Rs 1.22 lakh for every 10 grams. Expensive oil above $115 a barrel usually pushes fuel and transport costs up worldwide, which is why central banks hesitate to cut rates.

For Punjabi and Indian workers in the Gulf, sustained oil prices above $115 support energy economies in the region, but the same energy-led inflation is also what is keeping global interest rates — and borrowing costs — higher for longer.