Gold and Silver Pull Back Amid Calm Trading Day

 

Gold and Silver Pull Back Amid Calm Trading Day

(Bullion News Network) – Precious metal prices retreated on Friday during a moderately calm trading session. Fed rate cut speculation remained in focus, with Wall Street setting fresh records as inflation data boosted calls for an interest rate cut at the FOMC’s October meeting. Gold pulled back on Friday by just under $14 per troy ounce, its third daily loss of the week. Silver lost a higher percentage, shedding $0.24/ozt. The price action favored gold, driving the gold-silver ratio to 84.50:1. Platinum and palladium prices similarly retreated, with platinum losing over $16/ozt and palladium taking a harder hit of nearly $30 per troy ounce. As the U.S. prepares for the fourth week of its ongoing government shutdown, today’s price action appears to be a calm moment before what may turn out to be a chaotic week.

Rate cut speculation has played an outsized role in precious metal price action this quarter. After the Federal Reserve’s decision to cut rates by 25 basis points at its September meeting, traders looked toward the FOMC’s next meeting in October. Markets consistently bet on another 25-point cut in October. The Federal Reserve’s next meeting will occur next Wednesday on October 29th. CME FedWatch projects a 96.7% probability that the FOMC will vote to cut rates by 25 basis points, down from 98.3% on Thursday and 98.4% last Friday. 

Potentially bolstering rate cut expectations was a fresh inflation report released on Friday. Consumer prices increased by 0.3%, pushing the overall inflation rate in the U.S. to its highest point since January of this year. Analysts expected a larger uptick of 0.4%, making this report a welcome piece of news for investors – and potentially for the Federal Reserve. Since cutting rates can introduce inflationary risk to the economy, progress on inflation is likely to play a major role in the Fed’s decision-making process as it considers cutting rates for a second time in October in response to the cooling U.S. job market. 

Wall Street celebrated the inflation news on Friday. The Dow, S&P 500, and Nasdaq set fresh all-time highs after the September inflation data circulated. Although the odds of an October rate cut pulled back from last week’s projections, Friday’s promising inflation report could give the FOMC the assurance it needs to pull the lever on another rate cut. The FOMC will meet next Wednesday to decide whether or not interest rates will fall again. Cutting rates is typically an inflationary action, and safe haven assets like gold and silver tend to thrive in environments of falling interest rates. 

Gold and silver both suffered some of their worst single-day losses of 2025 earlier this week. Gold shed close to $250 per troy ounce on Tuesday, while silver lost over $3.50/ozt the same day, just days after both metals set fresh all-time highs. Markets moderated for the rest of the week, with both metals moving only marginally in either direction following the pullback. Traders and institutions may be waiting for more signals from the Federal Reserve before markets see more substantial price action. 

Adding to the uncertainty is the U.S. government shutdown, which became the second-longest in American history earlier this week. Senate Republicans and Democrats failed to pass a spending bill Friday, ensuring that the shutdown will continue into its fourth week starting on Monday. The uncertainty surrounding the government shutdown may remain a driving force for safe haven demand moving forward. The Federal Reserve is considered independent from the rest of the U.S. government, so it will continue to meet, regardless of the shutdown.

Gold and silver pulled back on Friday amid a calm trading day and a surge on Wall Street. The price action slightly favored gold and drove the gold-silver ratio higher to 84.50:1. Platinum and palladium also lost to end the week, with the larger drop going to palladium.