Gold: “Ongoing Pressure”

A strong dollar, high interest rates, and rising energy prices are currently weighing on gold. Despite a slight recovery, the environment remains challenging. Michael Blumenroth analyzes the key drivers and looks ahead to upcoming central bank meetings and elections.

October 29, 2026 FRANKFURT (Xetra-Gold). No sooner had the first signs of fall appeared last weekend—with storms and rain—than gold prices were also swept up in a low-pressure system. There was no specific fundamental trigger for this. However, two familiar adversaries once again weighed on the precious metal’s prices: bond yields and the U.S. dollar. When it comes to yields, however, the situation is not so clear-cut at first glance, as yields on long-term U.S. and German government bonds actually fell sharply. At the same time, yields on other European government bonds rose, in some cases significantly. In addition, yields on shorter-term bonds remained at high levels around the globe—after all, inflation risks persist, which is likely to result in further interest rate hikes by many central banks.

Energy Prices: Inflationary Pressure Weighs on Gold

More generally, the higher the oil price, the greater the risk of inflation and the higher the likelihood that central banks will raise interest rates. This tends to create headwinds for gold prices. Last week, the price of Brent crude oil reached the $117-per-barrel mark for the first time since May. But that’s not all: Natural gas prices also continue to rise, reaching the 100-euro-per-megawatt-hour mark yesterday on the Dutch TTF futures exchange for the first time since late 2022—prices have more than tripled since the start of the year. A personal note: Maybe it was a good thing that the natural gas heating in our apartment complex was out of service for a while this week. That way, we could get a head start on preparing for winter…

Strong U.S. Dollar and Interest Rate Outlook Weigh on Gold

Another factor weighing on gold prices is the continued strength of the U.S. dollar, which briefly rose to a 17-month high against the euro yesterday. This week is also marked by several central bank meetings. The Bank of Canada raised its key interest rates yesterday for the first time in three years. While the U.S. Federal Reserve held off and left key interest rates unchanged, it hinted that another rate hike could—or even likely would—occur in December. The futures markets are pricing in an 80 percent probability of another increase at that time.

Gold Price: From Selling Pressure to Slight Stabilization

This complex situation continues to weigh on prices: On Thursday morning of last week, gold was trading at around $4,090 per ounce. However, gold prices began trending downward as the day progressed, and the downward movement accelerated on Friday. Sales by major investors aimed at cutting losses likely played a decisive role here as well. Prices briefly fell as low as about $3,975. While gold traded at times above and at times just below $4,000 per ounce during the first two trading days of this week, it has stabilized somewhat since yesterday, peaking at around $4,082. As of 7:30 a.m. this morning, gold is trading at $4,030.

Xetra Gold: Weaker Euro Cuts Losses

The Xetra Gold price thus also edged lower, though less sharply, thanks in part to the weaker euro against the U.S. dollar. During regular trading hours, it rose from 117 euros per gram last Thursday morning to about 118.7 euros later that same day. On Friday, however, it then fell to 114.2 euros. In the first half of the week, prices recovered moderately to 117.7 euros. Should the price remain at its current level when trading resumes later today, Xetra-Gold would currently be trading slightly lower than at this time last week, namely at 116.6 euros.

Outlook: U.S. Midterm Elections Take Center Stage

The ECB is also expected to leave key interest rates unchanged, as is the Bank of Japan tomorrow. Attention is therefore likely to shift toward the U.S. midterm elections next Tuesday, particularly with regard to the potential impact of the elections on the situation in the Middle East. In addition, inflation data for the eurozone is due on November 4.

I wish all readers a weekend that’s not quite as turbulent and hope you’re spared any pranks on Halloween. For logistical reasons, I won’t be able to write this market commentary again until mid-November, but hopefully I’ll have more encouraging news by then, since “Golden October” seems to have been a no-show this time around…