Gold prices declined on Thursday as investors reacted to the Federal Reserve's latest signals and awaited critical US inflation data. Spot gold dropped 0.7% to $4,037.98 per ounce by 0410 GMT, while US gold futures for December delivery held steady at $4,049.80. Analysts attributed the fall to ongoing Middle East tensions and market positioning ahead of the inflation report.
The Fed kept interest rates unchanged at 3.75%-4.00% on Wednesday, as expected, delaying any changes until after next week's midterm elections. Traders now see a 78% chance of a rate hike in December, down from 84% before the announcement. Higher rates typically reduce demand for gold due to its lack of yield.
Markets are closely watching the Personal Consumption Expenditures data due at 1230 GMT, a key inflation gauge for the Fed. Meanwhile, the World Bank predicted a 23% surge in global commodity prices this year, citing energy price increases and shipping disruptions from the Middle East conflict.
China's net gold imports via Hong Kong surged over 28% in September, reaching a five-month high. On the geopolitical front, US Vice President JD Vance sought to revive peace talks with Iran. Other precious metals also fell, with silver down 1.5%, platinum off 1.5%, and palladium sliding 0.6%.