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Gold prices rebounded during Friday's trading session, supported by a decline in both the US dollar and crude oil prices. December gold futures rose by 0.55% to reach $4,193.80 per ounce, while spot gold ticked higher to $4,174.21. Meanwhile, the US Dollar Index fell 0.6% to 101.93, marking its first weekly loss in five weeks and offering temporary relief to precious metals. Silver and platinum spot prices also experienced moderate gains alongside gold futures.
Despite the daily rebound, gold remains on track to close the week with overall losses. Market sentiment is heavily influenced by hawkish Federal Reserve expectations, reinforced by recent inflationary pressure. Chicago Fed President Austan Goolsbee characterized the latest higher-than-expected inflation metrics as disappointing, heightening fears that interest rates may remain elevated for longer than previously anticipated.
Looking ahead, market participants are pricing in an 89% probability of a Fed rate hike in December according to the CME FedWatch tool, alongside a 28% chance of a hike later this month. Higher interest rates typically weigh on non-yielding bullion. Investors will closely watch upcoming US economic releases and central bank commentary to gauge whether gold can sustain its rebound or resume its broader downward trajectory.
