Gold (XAUUSD) fell about 2.7% to close near $4,024, its lowest since early August, after oil jumped on Houthi attacks in Saudi Arabia and markets added to bets on a December Fed hike. The yen strengthened sharply, pushing USD/JPY below 157. Tonight at 14:00 GMT, watch the revised UMich survey.
Updated Fri 23 Oct 2026 · 01:05 GMT · Prices as of New York close Thu 22 Oct 2026
Key takeaways
- 1Gold (XAUUSD) fell about 2.7% to close near $4,024, its lowest since early August, on surging oil and expectations of a Fed rate hike in December
- 2WTI crude closed near $99.47 and Brent rose to around $113 after the Houthis struck targets in Saudi Arabia. The dollar (DXY) held steady near 101.7
- 3The yen gained about 1%, with USD/JPY closing near 156.53. This morning Japan’s September CPI rose to 2.1% (core 2.1%) ahead of next week’s BoJ meeting
- 4Today, watch the revised UMich survey at 14:00 GMT (forecast 46.3) and flash PMIs from the eurozone, UK and US
Key events · Fri 23 Oct 2026
- MED
- UK retail sales (Sep)Forecast −0.1% m/m · previous 0.5%MED
- Eurozone composite PMI, flash (Oct)Forecast 52.7 · previous 53.1MED
- UK composite PMI, flash (Oct)Forecast 51.8 · previous 52.0MED
- S&P Global US PMI, flash (Oct)Services forecast 58.0 · previous 58.8MED
- UMich US consumer sentiment (Oct, revised)Forecast 46.3 · preliminary 46.3Watch 1-year inflation expectations (preliminary 4.7%)Read analysis →Due today 14:00 GMTHIGH
Market overview
Approximate closing prices for Thursday 22 Oct 2026 (New York) from Trading Economics · ▲▼ vs previous day · Gold: Trading Economics shows $4,023.89 (−2.83%), while Reuters reported around $4,084 in the New York morning · WTI matches Rigzone
Oil surges on Saudi attacks, gold suffers its steepest drop in weeks
On Thursday (22 Oct) the Houthis struck targets in Saudi Arabia, including the Red Sea port of Yanbu, oil facilities and an airport. At the same time, reports said the US and Israel were preparing to strike Iran again after the midterm elections. WTI crude closed near $99.47 and Brent climbed to around $113, stoking inflation worries. Gold (XAUUSD) fell about 2.7% to around $4,024, its lowest since early August, with Trading Economics noting that gold was pressured by expectations of higher interest rates.
Markets still see about an 89% chance the Fed holds rates at its 27–28 Oct meeting, but price roughly a 76% chance of a 0.25% hike in December. Even so, the US 10-year Treasury yield fell more than 10bp to around 5.0%, its lowest in about a month, as money flowed into bonds amid tech-stock volatility and worries over AI valuations. The dollar (DXY) therefore held steady near 101.7, close to a 3-week low, while the yen and Swiss franc drew safe-haven demand.
“Japan’s underlying inflation is approaching the 2% target, and monetary policy adjustment should not be delayed.”
Ryozo Himino, BoJ Deputy Governor (paraphrased, via Trading Economics)
Asset by asset
Gold breaks $4,100, falls to lowest since early Aug
Gold fell about 2.7% in a single day to close near $4,024, as surging oil fuelled inflation worries and markets priced a December Fed hike. The former $4,100 support has become first resistance, with $4,150 above that, while $4,000 below is key psychological support. This morning prices are steady around $4,019–4,024. See the latest gold analysis →
Euro slips as French yields hit highest since 2002
The euro (EUR/USD) fell about 0.1% to close near 1.1221. Trading Economics noted that the French 10-year yield rose above 5%, its highest since 2002, on fiscal worries and domestic unrest, while high oil prices weighed on Europe’s economic outlook. Today at 08:00 GMT, the eurozone flash PMI will show how well the economy is holding up.
Yen at strongest since Sep on hawkish BoJ comments
USD/JPY fell about 1% to close near 156.53 and touched 156.37 (first support) this morning, which Trading Economics described as the yen’s strongest level since September. Support came from safe-haven demand and comments from BoJ officials signalling that policy adjustment should not be delayed. Japan’s September CPI at 2.1%, with core excluding fresh food and energy at 2.4%, reinforced that view. Markets expect the BoJ to hold at next week’s meeting and possibly hike in December.
What to watch today
At 14:00 GMT today, the University of Michigan releases the revised October UMich consumer sentiment index. Markets expect 46.3, unchanged from the preliminary reading. More important is 1-year inflation expectations, which rose to 4.7% in the preliminary survey, as this is the last major print before the Fed’s 27–28 Oct meeting. Before that, the US flash PMI is due at 13:45 GMT, with UK retail sales and the UK and eurozone PMIs earlier in the day.
- Fed decision (FOMC)Wed 28 Oct 18:00 GMT
- US Q3 GDP + Core PCE (Sep)Thu 29 Oct 12:30 GMT
- ECB decisionThu 29 Oct 13:15 GMT
- US Employment Cost Index (ECI)Fri 30 Oct 12:30 GMT
Our view
The market is being pulled two ways. Surging oil from the Middle East is lifting expectations that the Fed will have to hike, which is weighing heavily on gold. Yet the 10-year yield fell as risk-averse money moved into bonds, so the dollar did not strengthen. The yen is the clearest winner from both safe-haven flows and the BoJ’s stance. Ahead of next week’s Fed and BoJ meetings, prices could be highly volatile.
- 1Gold needs to hold $4,000A break of this psychological support could accelerate selling. On a rebound, $4,100 is first resistance.
- 2Watch inflation expectations in UMichA 1-year reading above 4.7% would further support the case for a December Fed hike.
- 3Beware Middle East headlines over the weekendAttack headlines could cause oil and gold to gap at Monday’s open. Reduce position sizes and set a stop loss on every order.
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Sources (11)
- University of Michigan – Surveys of Consumers
- FXStreet – Japan CPI Sep 2.1% (22 Oct)
- Trading Economics – Gold (22 Oct)
- Trading Economics – DXY / Fed odds (22 Oct)
- Trading Economics – USD/JPY / BoJ (22–23 Oct)
- Trading Economics – EUR/USD (22 Oct)
- Trading Economics – GBP/USD (22 Oct)
- Trading Economics – AUD/USD (22 Oct)
- Trading Economics – Crude oil (22–23 Oct)
- Trading Economics – US 10Y (22 Oct)
- Trading Economics – US / UK / eurozone calendar (forecasts)
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