Gold Falls Below $3,950 as Strong Dollar and Fed Hike Bets Weigh
Gold slid further below $3,950 on Thursday, November 12, 2026, its third straight daily loss, as a stronger US dollar and bets on a December Federal Reserve rate hike weighed on the metal. The dollar index hit its highest level since April 2025.
Gold hits fresh one-week lows on Thursday, November 12, 2026, sliding further below $3,950 in the first half of the European session. It is the third straight day of heavy selling for the metal, traded as XAU/USD (gold priced in US dollars).
The main driver is a stronger US dollar. Gold is priced in dollars, so a firmer greenback makes it costlier for buyers using other currencies and tends to weigh on demand.
Fed hike bets harden
The October US Consumer Price Index (CPI) report, released earlier this week, showed hot inflation. It strengthened expectations that the Federal Reserve will keep tightening policy, and several influential Fed policymakers reinforced that view with hawkish comments.
Markets now bet the Fed will raise borrowing costs again in December. Traders have also begun pricing in a possible jumbo 50-basis-point hike next month; a basis point is one-hundredth of a percentage point.
The yield on the benchmark 10-year US government bond moved back above 5% on Wednesday. Higher yields add to the dollar's appeal.
What Rabobank said
Analysts at Rabobank said the market is now "fully priced for a December rate hike." They pointed to comments from Fed official Waller that put the risk of a 50-bps hike on the table.
The bank said those comments were "met with no real speculation that the Fed would be pressured by political forces not to raise rates." Rabobank added that fears about diminished Fed credibility have faded since Fed Chair Warsh took a hawkish position at Jackson Hole in August. It also said last week's midterm election results suggest less reason to expect pressure from the White House.
Middle East adds support to the dollar
The US-Iran standoff over the Strait of Hormuz keeps a geopolitical risk premium in play. Both sides have struck islands in the waterway in recent days.
US forces reportedly carried out strikes on Iran's Qeshm Island. Tehran attacked ship navigation systems on the Omani island of Didamar, at the entrance of the Persian Gulf.
Iranian Armed Forces Deputy Chief of Staff Brigadier General Kioumars Heidari said Tehran has closed the waterway and will open it only on the order of the leader of the revolution.
These factors pushed the US Dollar Index, which tracks the dollar against a basket of currencies, to its highest level since April 2025.
Technical picture
Gold stays weak in the near term after the previous day's rejection near the 100-hour Exponential Moving Average (a trend-following price average) at $4,044. The metal then fell below the 50.0% retracement level and the $4,000 psychological mark.
The Relative Strength Index, a momentum gauge, sits near 31 and is recovering only slightly from oversold territory. The MACD indicator has turned marginally positive, but momentum readings hint at stabilization rather than a decisive reversal.
Traders now look to the weekly US initial jobless claims data and speeches from Fed officials. Further geopolitical headlines could add volatility to both the dollar and gold.
