The Federal Reserve’s first interest-rate increase in three years continued to shape precious metals markets on Tuesday, as a stronger U.S. dollar and falling oil prices pulled gold and silver in different directions. Spot gold traded around $4,360 an ounce early after reversing an earlier decline, while gold futures slipped about 0.6% to $4,357.22. By 12:10 p.m. ET, spot gold was down 0.4% at $4,325.03, and spot silver was down 0.5% at $65.68, according to Reuters. The U.S. Dollar Index rose to 100.46 after gaining more than 1% the prior week.
The Fed raised its target range by 25 basis points to 3.75%–4.00% effective September 17, marking the first hike since July 2023. The vote was unanimous, and officials have kept the door open to further tightening. Chicago Fed President Austan Goolsbee said the central bank cannot ignore repeated supply shocks, while St. Louis Fed President Alberto Musalem said more rate rises may be needed to bring inflation down. Markets were assigning a high probability to another rate increase before year-end.
Falling oil prices offered some relief. Crude dropped more than 9% over four sessions and logged its longest losing streak since August 2025 as Middle East supply concerns eased. President Trump said he is open to meeting Iranian President Masoud Pezeshkian at the United Nations General Assembly. ANZ analysts cautioned that energy prices remain above pre-conflict levels, meaning inflation could fall slowly and unevenly. TD Securities global head of commodity strategy Bart Melek said markets were continuing to price further Federal Reserve tightening, while recent dollar strength was working against gold. TD Securities analyst Ryan McKay said gold is “holding extremely strong” after the rate hike, with falling energy prices offering support and near-term weakness “increasingly seen as a buying opportunity.”
Central bank and ETF demand remained supportive. China bought around 20 tonnes of gold in August, the most in three years, and Chinese gold imports rose more than 80% year over year. ETF inflows into gold-backed funds reached about 50 tonnes in September, the third straight month of gains. The 10-year Treasury yield, which moved above 5% around the Fed decision, fell back to about 4.93% on Tuesday, easing some yield pressure. Silver held near $66, keeping the gold-silver ratio around 65.8, only slightly wider than Monday’s reading of 65.74 and below the roughly 67 level earlier in September. Silver remained about 51% higher than a year ago, when spot silver was quoted at $43.64.
