Gold Faces Pressure as Real Yields Climb After October CPI Report

Gold kicks off the Thursday session with its eyes on U.S. inflation data, a sharp increase in Treasury real yields, and the market holiday yesterday in the United States affecting the interpretation of price action.

CPI Effects Still Being Felt

The Bureau of Labor Statistics reported on Tuesday that the October CPI rose 0.4% month over month on a seasonally adjusted basis, down from 0.6% in September. Core CPI, excluding food and energy, advanced 0.3%, matching August and September. Energy prices rose 0.7% during October after a 5.2% jump in September, while gasoline increased 1% on a seasonally adjusted basis.

In other words, we had seen some easing in the headline monthly inflation numbers, but not a broad retreat in core pricing. For gold, this is not necessarily a bullish sign. Slower headline inflation can reduce inflation-hedge demand and support expectations of a less restrictive Federal Reserve, yet the steady pace of core CPI gaining 0.3% could keep policymakers cautious.

Real Rates

The immediate market concern is the change in expected rates and real yields rather than the CPI release itself. Treasury’s latest daily par real yield curve is for November 10 due to the holiday. The 5-year real yield rose to 2.56%, the 10-year to 2.78%, and the 30-year to 3.17%. These figures were up from 2.35%, 2.63%, and 3.0%, respectively, the previous week.

The higher yields, as far as real yields are concerned, increase the opportunity cost of holding a non-yielding asset like gold. The yield curve has also steepened in real terms over the long end, with the 30-year rate above the 5-year. These Treasury figures are derived from TIPS par yields, not tradable security prices, but they can create inverse pressures on gold, with a broad rise in inflation-adjusted yields meaning a significant hurdle for gold.

The CPI itself carries a data limitation. The BLS did not collect October 2025 survey data during the lapse in the appropriations bill fight in Congress, so it cannot publish 12-month percentage changes for October 2026 for the series.

Can Rates Stabilize?

Gold’s next test will be whether real yields stabilize after the post-CPI increase and whether investors interpret the report as inflation pressure easing or persistent core strength. A sustained decline in real yields, renewed official-sector purchases, or a worsening geopolitical outlook could support the metal. However, higher real rates and stable risk appetite would weigh against it.

The Technical Analysis for Gold Looks Horrible

We are threatening a breakdown below the $3,900 level. Ultimately, this is a market that I continue to fade rallies in, and I would not be surprised at all to see gold drift towards the next significant support level on the longer-term charts, closer to the $3,600 level.

I have no interest in buying gold at the moment, but I do believe that, longer term, it will re-enter a bullish trend, offering a buy-and-hold opportunity.

If you’d like to know more about how to trade gold and silver, please visit our educational area.