GOLD PRICES RECORDED A VIGOROUS DECLINE IN THE INTERNATIONAL MARKET ON TUESDAY. THE SUDDEN SPEED IN THE DOLLAR MADE HEAVY PRESSURE ON GOLD. ACTUALLY, THE FIGURES OF CONSUMER INFLATION (CPI) THAT WERE WARMER THAN EXPECTED IN THE US AND STRICT STATEMENTS OF THE OFFICER OF THE FEDERAL RESERVE HAVE SHOCKED INVESTORS. NOW THE MARKET HAS BEEN SHARPENED THAT THE FEDERAL RESERVE CAN SIGNIFICANTLY INCREASE THE INTEREST RATES IN THE NEXT MONTH
Spot Gold slipped at $4,030.33 per ounce with a heavier drop of 2.7% at 15: 40 pm at U.S. time. While Gold Futures 1.9% broke up to $4,037.95 per ounce. On the other hand, the US dollar index, showing the strength of the US currency, compared to the six major currencies in the world, came to the level of 102.25, which spoiled the mood of the commodity market
Interest rate increases by 0.50% in December
THE VIEW OF THE ENTIRE FINANCIAL MARKET ON TUESDAY WAS HELD ON THE US CONSUMER PRICE INDEX (CPI). ACCORDING TO THE DATA RELEASED BY THE BUREAU OF LABOR STATISTICS, THE HEADLINE CPI GREW 0.4% IN OCTOBER MONTH AFTER AN EDGE OF 0.6% IN SEPTEMBER. THE ECONOMISTS ESTIMATED TO GROW 0.3% OF ITS SEASON. ALSO THE CORE CPI, WHICH DID NOT INCLUDE FOOD-DINE THINGS AND ENERGY PRICES, REMAINED STABLE AT 0.3%, WHICH IS HIGHER THAN 0.2% ESTIMATE
Comparative figures with an annual basis may not be issued in October 2025 due to the detention of the US government
The Fed Governor Christopher Waler, just before these data of the inflation, had raised concern in the market by a single speech in London. He clearly said that even if the figures come soft, they were in favor of increasing the interest rate. He warned that if the figures come hot, a large increase of half per cent (50 bases points) can also be stagnate
THIS HOT INFLATION REPORT AND THE SHARP STATEMENTS OF THE WALER AFTER THE STRONG EMPLOYMENT DATA THAT CAME ON FRIDAY HAVE ALMOST DIGESTED THAT THE FEDERAL OPEN MARKET COMMITTEE (FOMC) WILL DEFINITELY INCREASE THE RATES IN THE NEXT MEETING. NOW THE QUESTION IS JUST ABOUT HOW BIG IT WILL GROW. ACCORDING TO THE CME FEDWATCH TOOL, THE MARKET IS NOW RUNNING A 10% PROBABILITY STANDARDER CLOSE TO THE LARGE GROWTH OF 50 BASES POINTS IN DECEMBER
Danny Husson, head of Financial Analysis at AJ Bell, reported that the speed of energy prices was slow in October figures, but the high cost of gas is now seen on the rest of the economy. Even if the entire data or annual comparisons are not available due to government shutdown, it is clear that the effect of inflation is deepening. The core inflation is made out of the comfortable scope of the Fed, thereby strengthening the probability of a half-percent rate increase in December
Whenever the interest rates rise, the glossiness of the property without giving interest in gold is charged. As well as the strong dollar makes it expensive to buy gold in the currency of the other countries, thereby reducing global demand
Brent Crude slipped under $90 for the first time after August:
Among this stormy environment of inflation and interest rates, the weakness in crude oil helped to keep the fall of gold somewhat limited. This whole year the move of gold and crude oil has usually been in the opposite direction. The spot gold was rolled up by about 5% when the oil had declined last week. The oil was weakened by the hopes of the US-Iran Peace Agreement after the control of Democrats in the US medium-term elections at that time
The global standard Brent Crude Futures broke up at the lower level of $89.18 per barrel, which was the level below 90 dollars for the first time after August 31. Although a little recovery came from the lower levels later and it closed at a barrel of $92.02 with a decline of 0.6%
In crude oil, this softness found to be seen after that statement of the President Donald Trump, in which he said he hopes that the ongoing struggle with Iran will end very soon, although naval blockade will continue. The Trump also said that the military struggle with Iran is now almost over
The Trump’s comment came on Monday after the discussion on the Iran Agreement with Qatar Prime Minister Sheikh Mohammed bin Abdulrahman al-Thani. Qatar is playing the role of an important arbitrator between both countries. However, the oil prices declined slightly after the news of the attack on Saudi Arabia’s major East-West pipeline later by Iran-backed Hoots
Findings for Gold and Crude Oil Traders:
Existing time for commodity traders is quite alert. U.S. Dollar’s robustness and aggressive growth signals in interest rates by the Federal Reserve are suggesting that gold will continue to hold pressure on top levels. As long as the inflation does not come into a completely grasp, it can be dominated by any large rally in gold. While heavy fluctuations will continue due to geopolitical news in crude oil, traders should take positions along with strict stop loss