Gold Holds Near $4,000 as Inflation Expectations Creep Higher

The final reading for October came in at 48, surpassing the consensus forecast of 46.3. Despite this slight beat, the index remains 10% below year-ago levels and 15% lower than the February reading recorded just before the conflict in Iran. According to Surveys of Consumers Director Joanne Hsu, the current economic climate is defined by a sharp 18% decline in buying conditions for durables, fueled by elevated interest rates and anxiety over affordability.

Inflation remains the primary weight on sentiment. Year-ahead inflation expectations climbed to 4.7% from 4.6% in September, marking the second consecutive monthly increase and the highest level since May. Long-run expectations also rose to 3.5%, breaking out of the 2.8% to 3.2% range seen earlier this year. With these figures now substantially higher than the 3.4% baseline observed in February, the spot gold market continues to hover near the $4,000 threshold, last changing hands at $4,014.71 per ounce.