Spot gold slipped below $4,000 an ounce in early Asian trade on Friday 30 October, after a sharper fall the day before, as stubborn US inflation kept bets on another Federal Reserve rate rise firmly alive.

Reuters reported spot gold down 0.4% at $4,006.06 by 0036 GMT, with December futures down 0.3% at $4,018.50. A later reported reading put spot gold at $3,997.93, down 0.58% on the day. The day before, gold had closed at $4,020.42 according to Refinitiv figures cited by CNBC Indonesia, a fall of 1.15% that ended a three-day winning streak.

Inflation keeps hike bets alive

The driver, according to Reuters, was September inflation data showing consumers paying more for petrol and other goods, reinforcing expectations that the Fed could raise rates again in December. Traders were reported to be pricing in about a 75% chance of a December hike, according to the CME FedWatch Tool. Higher US Treasury yields add to the pressure: they raise the return on bonds and cash, making non-yielding gold less attractive to hold, while a stronger dollar makes the metal dearer for overseas buyers.

A choppy month, not a collapse

The retreat should be kept in proportion. Reuters noted bullion was still headed for a modest weekly gain, even as it remained on track for a second consecutive monthly decline. Silver fell with gold, reported down 1% at $51.87 an ounce, while platinum was steady at $1,488.00. That pattern, gold and silver easing together on rate expectations, points to a rates-driven move rather than a loss of faith in precious metals alone.

What traders watch next

Attention now turns to further US price data and to how firmly Fed officials signal their December intentions. If inflation cools, the hike bets that are weighing on gold could unwind quickly. If it stays hot, the $4,000 level, long treated as a psychological dividing line, will face a sterner test, and the metal's next move will likely be set by rates, not by safe-haven demand alone.

Sources: Reuters via TradingView; PANews.