TLDR
- Spot gold rose 0.1% to $4,187.64 an ounce, but is on track for a monthly drop of about 6%.
- Gold futures gained more than 1% as U.S. Treasury yields pulled back from multiyear highs.
- Traders are focused on the U.S. core PCE inflation report, the Fed’s preferred inflation gauge.
- New York Fed President John Williams said there is no rush to raise rates again in October.
- The odds of an October rate hike fell to 42.6% from 70% earlier in the week, per CME FedWatch.
Gold prices ticked higher on Wednesday but remained on pace for a monthly decline. Investors are waiting for a major U.S. inflation report that could shape the Federal Reserve’s next move.
Spot gold rose 0.1% to $4,187.64 an ounce. Gold futures gained about 1% to $4,219.30 an ounce.
Despite the daily gain, spot gold has fallen roughly 6% over the past month. That would mark one of its weaker monthly stretches this year.
Inflation Data in Focus
The main event for traders this week is the release of the core personal consumption expenditures price index. This is the inflation measure the Fed watches most closely.
Gold $GLD – Make or Break Moment here 🚨 🚨 pic.twitter.com/Z1G7lOIeGW
— Barchart (@Barchart) September 29, 2026
Economists expect the core PCE reading for August to rise 0.3% month over month. That is up slightly from 0.2% in July.
The overall PCE reading is expected to climb 0.4% month over month, up from 0.2% the prior month. On a yearly basis, core PCE is projected at 3.3%, with the overall figure seen at 3.7%.
Both numbers would match July’s pace. They would also stay well above the Fed’s 2% target.
Higher inflation readings can complicate the Fed’s plans. They can also affect how attractive gold looks to investors, since gold does not pay interest or dividends.
The Fed raised interest rates by a quarter point earlier this month. That move was aimed at slowing rising prices across the economy.
It remains unclear whether more hikes are needed this year. New York Fed President John Williams said this week there is no immediate need to raise rates again in October.
His comments led traders to lower the odds of an October rate increase. The probability fell to 42.6%, down from 70% earlier in the week, according to the CME FedWatch Tool.
Still, most Fed officials disagree with a pause. Of the 18 members on the Federal Open Market Committee, all but two called for at least one more rate hike this year.
Treasury Yields and Geopolitical Factors
Gold futures rose more than 1% in early European trading. The move came as U.S. Treasury yields retreated from multiyear highs.
Lower yields tend to support gold prices. That is because they reduce the opportunity cost of holding an asset that does not generate income.
Outside of interest rate policy, developments in the Middle East are also being watched. Qatar is mediating talks between Washington and Tehran.
Those talks reportedly include discussion of reopening the Strait of Hormuz. That waterway is a key route for global oil shipments.
However, a breakthrough looks unlikely for now. President Donald Trump has denied reports that the U.S. offered Iran sanctions relief, while Iran continues to push for its own conditions.
Elevated oil prices add another layer of pressure on inflation. That in turn feeds concerns about further central bank tightening.
Traders are now also looking ahead to Friday’s U.S. payrolls report. Together with the PCE data, it will help shape expectations for the Fed’s next interest rate decision.
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