Gold and silver both fell for a third straight week, with silver the bigger loser, down over 3%, as hot US inflation data pushed rate-hike odds for the September 15-16 FOMC meeting to roughly 90%. Brent crude stayed near $100 on Strait of Hormuz tensions, while the rupee slid past 95.70 against the dollar. Gold ETFs saw strong $2 billion inflows even as silver ETFs saw redemptions, and central banks kept buying steadily. With the Fed decision looming, volatility is expected to stay elevated into mid-week.

PRICE PERFORMANCE

Gold It was a tough week for anyone holding bullion long. Gold notched its third straight weekly decline, and silver fared even worse, shedding over 3% as rate-hike jitters rattled the metals complex. The gold-silver ratio widened to roughly 67-68 — a clear signal that traders were treating silver’s industrial exposure as a liability rather than an asset once bond yields began climbing.

MACRO BACKDROP & FED POLICY

The macro calendar did most of the damage. August producer prices came in hot, rising 0.4% on the month with the annual rate accelerating to 5.4%. Friday’s CPI report confirmed the worst fears: headline inflation held at 3.4% year-on-year, while core CPI climbed 0.3% month-on-month — a tenth above what economists had expected.

Markets reacted exactly as you’d expect. The CME FedWatch tool showed the odds of a rate hike at next week’s September 15-16 FOMC meeting jumping from around 50-60% before the data to roughly 90% by Friday.

GEOPOLITICAL TENSIONS

Meanwhile, the US-Iran standoff around the Strait of Hormuz remained the single biggest wildcard. Renewed strikes through the week kept Brent hovering near the $100 mark, briefly pushing it toward six-week highs, as traders flagged continued disruption to tanker traffic through a corridor that normally carries roughly a fifth of the world’s seaborne oil. Oil prices rose about 3% on Monday, after new strikes on Saudi Arabian energy and civilian infrastructure and Iranian attacks on ships in the Gulf compounded supply concerns following the closure of a key Saudi oil pipeline.

CURRENCY MOVEMENT

The rupee had a rough week too, sliding from around 94.40 to test levels beyond 95.70 against the dollar — its weakest in months — as elevated crude prices widened India’s import bill worries and higher US yields pulled capital toward dollar assets. The RBI stayed active, leaning on spot and NDF intervention alongside FX swaps to slow the slide, but traders noted the central bank seemed less inclined to fight the move aggressively than in past episodes, effectively allowing a controlled depreciation rather than defending a hard line.

ETF FLOWS & CENTRAL BANK BUYING

Flow data told two very different stories for the two metals. Gold-backed ETFs pulled in roughly $2 billion over the week — among the strongest hauls in months — suggesting institutional investors used the dip to accumulate even as the near-term rate outlook turned more hawkish. Silver ETFs saw the opposite: modest net redemptions, hinting that paper silver holders were quicker to de-risk ahead of the Fed meeting than their gold counterparts.

On the official-sector side, central banks remain a structural source of demand rather than a swing factor reacting to weekly headlines. Steady purchases from the People’s Bank of China, Poland, Turkey, and the RBI have continued through the year, and this buying has been large enough in aggregate to absorb a meaningful share of the ETF selling seen earlier in 2026 — a dynamic that keeps putting a floor under gold even during weeks like this one.

WEEK AHEAD

With the Fed decision now the dominant event risk on September 16, expect volatility to stay elevated into mid-week. A hike delivered largely as priced could trigger a relief bounce in both metals on the classic “Sell the rumour, Buy the fact” pattern, while any hawkish surprise on the dot plot or the Chair’s press conference could extend this week’s losses further — before central-bank and Asian physical buyers step back in to defend the lower end of the range.

TECHNICAL OUTLOOK

Spot gold has support at $4300 (~ Rs 151,000), if it sustains below that, next target would be $4150 (~ Rs 145,500) psychological level as the next line of defence; while resistance sits at $4,430-4,500 (~Rs 154,500-156,000).

Spot silver has made Head and Shoulder pattern, where the neckline support is $62.5 (~Rs 231,000) to keep its broader uptrend intact — a break below opens the door toward $60 (~ Rs 220,000) and $57 (~ Rs 210,000) — while $67 (~ Rs 244,000) caps the upside near-term.

Dr. Renisha Chainani,Chief Research Officer, Augmont