Gold plunges over 2% as US inflation exceeds expectations

Gold prices plunged more than 2% on Tuesday after US monthly inflation exceeded expectations, fueling concerns over further interest rate increases by the Federal Reserve.

Gold fell 2.1%, or $87.60, to $4,052.90 an ounce as of 1330GMT, while silver declined 2.8% to $51.90 an ounce.

US consumer prices rose 0.4% in October from the previous month, exceeding market expectations of 0.3%, although the increase slowed from September's 0.6%.

Energy prices climbed 0.7%, food prices rose 0.5%, and shelter costs increased 0.3%, according to the inflation data.

Core consumer prices, which exclude volatile food and energy costs, rose 0.3% for the third consecutive month.

The figures followed hawkish remarks by Federal Reserve Governor Christopher Waller, who signaled support for a December interest rate increase.

Waller also raised the possibility of a larger increase if inflation proved stronger than he anticipated.

He indicated that he was leaning toward a 25-basis-point hike even if monthly inflation improved, while a substantially stronger reading could warrant considering a 50-basis-point increase.

His remarks came before the release of the inflation data.

Higher interest rates typically weigh on gold prices by increasing the opportunity cost of holding the non-interest-bearing metal.

Meanwhile, the Bureau of Labor Statistics did not publish annual headline or core inflation figures for October because the government shutdown in October 2025 disrupted survey data collection.

The disruption left the agency without the year-earlier figures needed for annual comparisons.