Gold climbs back above $4,100 as oil extends its slide on Trump's Iran comments, with October CPI due Tuesday

Two of the market's biggest inflation signals moved in opposite directions overnight. Gold climbed back above $4,100 an ounce as investors looked for safety and the dollar softened, while oil kept falling after President Donald Trump signaled that more U.S. strikes on Iran were unlikely if talks progress. Both moves land a day before the October Consumer Price Index, the last inflation report before the Federal Reserve's December meeting.

Gold erases Friday's dip

Spot gold was up about 1.2% to 1.6% in Asian and early European trading, at roughly $4,120 to $4,130 an ounce, according to Anadolu Agency, Saxo, Bloomberg and CNBC, with the exact level depending on the time of the reading. CNBC put U.S. gold futures for December delivery at $4,139.

The gain erased Friday's decline, when the stronger-than-expected October jobs report lifted the dollar and revived expectations of a December rate hike. Silver did even better, rising roughly 1.6% to 2.8% to around $52.70 to $53.30 an ounce, according to the same sources.

"Trump's more conciliatory tone toward Iran is helping keep a lid on oil prices, which in turn eases some of the inflation pressure that had been weighing on the metal along with a modest pullback in the dollar," Tim Waterer, chief market analyst at KCM Trade, told CNBC.

Bloomberg also pointed to the investigation into Nvidia CEO Jensen Huang as a factor that dented risk appetite in Asia and added to gold's appeal as a haven on Monday morning.

Oil keeps sliding

Brent crude, the international benchmark, fell about 1.5% to around $96.80 a barrel, according to Anadolu and Saxo. U.S. West Texas Intermediate slipped about 1% to between $89.70 and $89.90, according to Anadolu and futures data. Brent is coming off its biggest weekly decline since April 2020, according to Saxo and Bloomberg.

The trigger on Monday was Trump's comment that further attacks on Iran were highly unlikely as talks to end the conflict continued, which eased worries about supply disruptions, CNBC and Saxo reported. The relief has limits: Saxo noted that tanker attacks in the Gulf are continuing, and Bloomberg said traders were weighing diplomacy against fresh attacks in the region.

Crude had already been falling since late October, as last week's Democratic sweep in the midterm elections raised expectations that the conflict would not escalate sharply, according to Saxo.

Why oil matters for the Fed

Cheaper oil feeds straight into the inflation debate. Energy prices drove much of the jump in consumer prices in August and September, and UBS analysts estimate that energy's contribution to monthly inflation shrank sharply in October, according to Morningstar.

That is the backdrop for Tuesday. Economists surveyed by FactSet expect the October CPI to show a 0.24% monthly increase in headline prices and a 0.2% rise in core prices, which exclude food and energy, according to Morningstar and TradingKey. September's readings were 0.6% and 0.3%. RBC expects 0.3% for both.

One quirk: the Bureau of Labor Statistics will not publish an annual inflation rate for headline or core CPI this time, because prices were not collected in October 2025 during the government shutdown. September's 3.7% annual rate remains the latest official figure until next month.

The hike question

Even a softer reading may not change the Fed's course. CME FedWatch showed about a 79% chance of a quarter-point hike in December, up from 71% before Friday's jobs data, CNBC reported, and other trackers put it near 80%. "With inflation sticky above the target and the labor market stable, we think another hike will be warranted in December," Christopher Hodge, chief U.S. economist at Natixis, wrote, according to Morningstar.

For gold, that makes Tuesday a two-way risk. A hot reading would likely support the dollar and raise hike odds, which tends to weigh on a metal that pays no interest. A cooler one could extend Monday's rebound. The Producer Price Index follows on Friday.