Gold Prices Predicted to Face Volatility This Week

Gold and silver prices are expected to face significant turbulence this week. Investors are awaiting the interest rate decision from the US central bank, the Federal Reserve (The Fed).

According to Refinitiv, gold prices fell by 0.35% during trading on Monday (14/09/2026) at 06:59 WIB. Gold prices closed up 0.73% to US$4,347.32 per troy ounce on Friday (11/09/2026) trading; however, overall, gold prices fell by 1.83% last week.

The decline in gold last week was partly triggered by rising US inflation. Consumer inflation in August rose by 0.4% month-on-month, higher than the 0.1% increase in July. On an annual basis, US inflation stood at 3.4%, in line with market expectations.

This condition has led the market to increase bets on the possibility of the Fed raising interest rates by another 25 basis points. If the Fed remains focused on fighting inflation, high interest rates could potentially drive up US Treasury yields and strengthen the US dollar. Such conditions typically make gold less attractive as it provides no yield.

Amidst pressure from the Fed and the US dollar, demand from China remains one of the primary supports for gold. China reportedly purchased more than 40 tonnes of gold through the London over-the-counter (OTC) market in June, marking China’s second-largest monthly purchase since the start of 2025. Gold purchases by China have helped cushion selling pressure from investors concerned about rising interest rates and a strengthening dollar. Strong physical demand will become increasingly important if investors in financial markets begin to reduce their exposure to gold. However, massive purchases from China may not be sufficient to sustain a gold rally if global monetary policies become increasingly tight.

Gold Prices Face Crucial Test This Week, The Fed is Key. Currently, both macroeconomic and technical conditions still provide bearish signals for gold. Gold prices fell 1.8% throughout last week and are now recording a decline for three consecutive weeks. This indicates that gold’s momentum is starting to lose steam after a sharp surge in August.

Investor attention this week will be focused on the Federal Open Market Committee (FOMC) meeting and the statement by Fed Chair Kevin Warsh on Tuesday and Wednesday, which could determine the future direction of gold. The Fed’s decision could determine whether gold is able to rebound or if it will instead test the US$4,000 level again.

At present, gold is caught in a tug-of-war between two forces. On one side, there is Chinese demand and safe-haven flows. On the other, there are high oil prices, a strengthening US dollar, and the risk of Fed policy tightening.

Gold Price Forecast for This Week. As long as pressure from monetary policy does not subside, gold is expected to struggle to test US$4,700 again. Entering this week, technical indicators still suggest the possibility of a moderate decline in gold prices before the Fed meeting on Wednesday. The decision is particularly crucial after US inflation data once again showed higher pressure.

The biggest question for investors now is not just whether the Fed will raise interest rates, but whether such an increase will be a one-off or the beginning of further hikes towards the end of the year. If the Fed signals further tightening, gold could face renewed pressure.

Oil prices have also surged in recent days, despite a slight correction on Friday. However, the overall trend remains upward, adding inflationary pressure to the global economy. If inflation rises again, the room for the Fed to maintain tight monetary policy will increase.

Pressure is also coming from the US bond market. The 10-year US Treasury yield approached the 5% level last week. This level is a significant psychological threshold and could trigger profit-taking. However, overall, the bond market remains under pressure and yields continue to move upwards. This situation is not good news for gold. When real yields and interest rate expectations rise, gold, which provides no yield, becomes less attractive to investors. Pressure will intensify if the US dollar continues to strengthen.

The US$4,400 area is now a key level to watch. If gold can hold above this level, the opportunity for prices to return to previous records remains open. If selling pressure continues, gold could potentially return to US$4,100 in the near future, potentially coinciding with the Fed’s decision on Wednesday. If US$4,100 is breached, market attention will shift to US$4,000. If that level is also broken, gold could test US$3,942, which was the low point in June.

Meanwhile, silver prices fell by 0.87% during trading on Monday (14/09/2026) at 07:00 WIB. Silver prices closed up 1.4% on Friday trading to US$64.57 per troy ounce (11/09/2026). Overall, silver prices fell by 2.6% last week.