Gold fell to a one-year low on Friday and silver slid below US$50 an ounce for the first time since November 2025 as higher energy prices and persistent inflation concerns strengthened expectations that US interest rates will stay high.
Spot gold was down 2.7 percent at US$3,910.53 per ounce by 10:05 a.m. ET (1405 GMT), its lowest since October 2025.
US gold futures for December delivery fell 2.8 percent to US$3,919.60 per ounce. Bullion prices are on track for a second straight monthly decline, down 5.9 percent so far this month.
Spot silver was down 5.8 percent at US$49.34 per ounce, its lowest since November 2025.
"Ongoing concerns about inflation have multiple central banks continuing to tilt hawkish," said Peter Grant, vice president and senior metals strategist at Zaner Metals.
"Even though holds were delivered by major central banks this week, the indication was that the higher-for-longer theme prevails, and that's weighing on precious metals."
Major central banks hit pause on rate rises this week, but made clear the tightening cycle isn't over, with the US Federal Reserve and the European Central Bank both pointing to inflation risks from surging energy costs.
Data on Thursday showed US inflation accelerated in September as consumers paid more for gasoline and other goods, bolstering economists' expectations of a rate hike in December.
Another factor for the price decline is the sharp fall in technology stock prices, which may have led to forced selling and margin calls, analysts at Commerzbank said in a note.
"We consider the fall in precious metal prices to be exaggerated and continue to expect a recovery," they added.
The tech-heavy Nasdaq was set for steep losses at Friday's open on AI spending worries. MKTS
Meanwhile, oil prices climbed and were set for a fourth monthly gain. Higher energy prices strengthen expectations of a prolonged period of elevated interest rates, making non-yielding assets such as gold less attractive.
Elsewhere, physical gold demand in key Asian markets remained subdued this week, with Indian buyers delaying purchases in anticipation of a further decline in prices, while demand in top consumer China stayed muted.
Platinum dropped 4 percent to US$1,428.35, its lowest since September 2025, and palladium fell 3.1 percent to US$975.25, its lowest since June 2025. Both were poised for weekly and monthly declines.
Reuters
