October 15, 2026
An unexpectedly high US Consumer Price Index reading for September abruptly reversed interest rate expectations in the futures markets and triggered a noticeable wave of selling in precious metals. Yesterday, Wednesday, the silver price plunged by around 6 percent, while gold fell below the psychologically important mark of US$4,100 per ounce (down at least 1.3 percent from the previous day's close near US$4,155). The reassessment of the Federal Reserve's interest rate path has removed the rate pause that had previously been fully priced into the markets.
US core inflation accelerates – CME FedWatch signals rate move
According to the Bureau of Labor Statistics, US consumer prices rose by a seasonally adjusted 0.6 percent month over month in September, pushing the annual rate to 3.7 percent (August: 3.4 percent). Economists surveyed by Dow Jones had expected 0.6 percent and 3.6 percent, respectively, according to CNBC. The core rate, which excludes volatile energy and food prices, also came in above expectations, rising 0.3 percent month over month and 2.6 percent year over year (August: 2.4 percent; forecast: 2.5 percent).
Sonu Varghese, Chief Macro Strategist at Carson Group, summed up the dynamics in comments to CNBC: “The CPI came in hot, and it wasn’t just fuel prices.” As the report represents the last key inflation data release before the FOMC meeting on October 27 and 28, markets are pricing in tighter monetary policy.
Key drivers and macroeconomic indicators at a glance:
- Broad-based inflationary pressure: The energy index rose 5.2 percent month over month, driven by gasoline (+9.1% for the month, accounting for roughly half of the overall monthly CPI increase; +34.2% year over year) and heating oil (+74.2% year over year), against the backdrop of the war between the US and Iran that has continued since late February and Brent crude prices above US$106 per barrel. At the same time, shelter costs (+0.4% MoM; +3.2% YoY), used vehicles (+0.7%), and apparel (+0.3%) also increased.
- Rate expectations turn higher: After the Fed raised its key interest rate in September for the first time in more than three years by 0.25 percentage points to a range of 3.75% to 4.00%, the probability of a follow-up move in October, as indicated by the CME FedWatch Tool, climbed to around 54%; the probability of an increase by year-end stands at more than 96% (with the odds of a 50-basis-point increase by December at roughly 50-50).
- Firm dollar and rising yields: According to Rio Times, the U.S. Dollar Index gained 0.34 percent to around 102.5 points, making metals more expensive outside the dollar zone and, together with rising bond yields, weakening the traditional inflation-hedge argument.
- Calendar and prediction markets: On the evening of October 14, Polymarket put the probability of silver reaching the $54 mark in October at 61.5%; for gold, the probability of testing the $4,200 mark was 80.5%.
Pan American Silver and mining stocks under selling pressure
Silver’s decline was four times that of gold, reflecting the metal’s dual role as a store of value and an industrial component used in solar panels, electronics and medical technology (Yahoo Finance). Rising interest rates weigh on both pillars: They increase the opportunity cost relative to interest-bearing investments and dampen the economic outlook. Combined with the market’s traditionally lower depth, this led to disproportionate selling: The SLV silver ETF fell 6.11 percent to US$50.22, while the GLD gold ETF closed down 1.49 percent at US$375.99.
With upcoming US producer prices, retail sales and initial jobless claims, followed later by the PCE price index, the economic calendar remains packed. As long as the market continues to price in additional Fed rate moves, interest rate and currency pressures will dominate market activity.
Source：https://goldinvest.de/en/silver-plunges-6-gold-below-usd-4-100-as-us-inflation-fuels-rate-fears
