Gold under pressure: rising inflation increases the likelihood of a Fed rate hike as early as November

Gold prices have fallen to their lowest levels since October 2025, currently hovering at 3,894 USD. For more details, see our analysis for 2 November 2026.

XAUUSD forecast: key takeaways

• US GDP grew by 3.4% in Q3 2026
• At its meeting on 28 October, the Federal Reserve kept its interest rate unchanged within the 3.75%–4.00% range
• XAUUSD forecast for 2 November 2026: 3,800

Fundamental analysis

Today's XAUUSD price forecast for 2 November 2026 shows that US macroeconomic data released on 29 October put pressure on the precious metal. According to the preliminary estimate, the US economy grew by 3.4% year-on-year in Q3, following growth of 2.2% in Q2. The acceleration in economic activity indicates resilient domestic demand and reduces the need for monetary policy easing.

At the same time, the Personal Consumption Expenditures (PCE) price index rose by 0.5% month-on-month in September, while annual inflation accelerated from 3.4% to 3.6%. Core PCE inflation stood at 3.1% year-on-year, remaining significantly above the Federal Reserve's 2% target. The combination of strong economic growth and elevated inflation creates unfavourable fundamental conditions for a recovery in XAUUSD.

The US Federal Reserve's monetary policy remains the main source of pressure on gold. At its meeting on 28 October, the central bank kept interest rates within the 3.75%–4.00% range. The decision was adopted by ten votes to two, with two Fed officials supporting a 25-basis-point rate hike. In its accompanying statement, the central bank noted the steady expansion of economic activity, strong productivity growth, substantial capital investment, and persistently elevated inflationary pressure.

The XAUUSD forecast for 2 November also takes into account that the fundamental factors providing long-term support for gold remain in place. According to the World Gold Council, global central banks increased their gold reserves by 39 tonnes in August, with net purchases year-to-date reaching 170 tonnes. In addition, global gold-backed ETFs attracted a record 31 billion USD in Q3, including 10 billion USD in September. Sustained institutional demand could limit the extent of further declines.

Technical outlook

On the D1 daily chart, XAUUSD prices have broken below the 3,975 USD support level, while resistance has formed at 4,085 USD. On the H4 chart, a local support level lies at 3,870 USD, with resistance at 4,035 USD.

Given the continuing downtrend, the most likely scenario remains a further decline in XAUUSD prices. If the local support level at 3,870 USD is broken, the downside target could be 3,800 USD.

An upward correction, potentially taking prices towards 4,150 USD, would invalidate the main scenario. Such a move would require a breakout above the nearest resistance level at 4,085 USD.

XAUUSD overview

• Asset: XAUUSD
• Timeframe: H4 (Intraday)
• Trend: bearish
• Key resistance levels: 4,035 and 4,085
• Key support levels: 3,975 and 3,870

XAUUSD trading scenario for today

After breaking below the 3,870 USD support level, prices could continue their downward trajectory.

Risk factors

The main risk factors for XAUUSD remain changes in expectations regarding the Federal Reserve's future monetary policy, movements in the US dollar, and US Treasury yields. Sustained economic growth, elevated inflationary pressure, and strong labour market data could reinforce expectations of further interest rate hikes, adding to pressure on gold. Conversely, signs of a slowdown in the US economy and a weakening labour market could boost demand for the precious metal.

Summary

Fundamental factors suggest that gold will remain under pressure in the short term. Resilient US economic growth, elevated inflation, and the Fed's hawkish rhetoric are supporting expectations of further interest rate hikes, reducing the precious metal's investment appeal. High US government bond yields remain an additional negative factor. At the same time, geopolitical uncertainty, continued gold purchases by central banks, and investment demand from ETFs could limit the decline in prices. XAUUSD technical analysis suggests a fall towards the 3,800 USD support level.

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