Gold prices slipped on Thursday as investors digested the Federal Reserve's decision to leave interest rates unchanged and waited for fresh US inflation data. Spot gold fell about 1% to around $4,024–$4,035 an ounce in early trading, with reports differing slightly by time of day, while US gold futures for December delivery were down more modestly, at about $4,036–$4,047. Bullion was on track for a second straight monthly fall, a sign of how far sentiment has cooled from its earlier highs.

What the Fed decision changed

The Fed held its benchmark rate steady on Wednesday in the 3.75%–4.00% range, as expected, deferring any change until after next week's US midterm elections while it awaits more inflation data. Chair Kevin Warsh's remarks were read as hawkish by some traders, reinforcing bets on a possible rate rise in December. Market pricing put the chance of a December hike at roughly 83%–90%, depending on the measure cited, and the US dollar stayed near a two-week high. Because gold pays no interest, higher rates for longer raise the opportunity cost of holding it and tend to weigh on prices.

What traders are watching next

Attention now turns to US Personal Consumption Expenditures data, the Fed's preferred inflation gauge, due on Thursday. Analysts warned that a stronger-than-expected reading could push gold back below $4,000 and strengthen the case for a December hike, while a softer print could offer relief. Other metals fell alongside gold, with spot silver down about 1.9%–2.3% to roughly $52.71–$52.93 an ounce and platinum down about 1.8%–2.9%. Geopolitical risk remains a counterweight: analysts noted that if oil benchmarks revisited $120 and beyond, the resulting inflation pressure could tighten policy further and leave gold vulnerable, even as Middle East tensions continue to support some safe-haven demand.

Sources: Reuters via Kitco, Reuters via Maaal.