Gold Spot Price AUD $6115.43

Silver Spot Price AUD $91.07

Platinum Spot Price AUD $2511.91

Australians are heading into next week with another interest rate rise looking increasingly difficult to avoid. Financial markets are now pricing around a 95% chance that the RBA lifts the cash rate by another 0.25% on Tuesday, 29 September, taking it from 4.35% to 4.60%. The RBA has already lifted rates three times this year, but stubborn inflation, elevated energy costs and continued domestic price pressures have kept the door firmly open for another increase.

RBA Governor Michele Bullock has stopped short of confirming the move, but her recent comments have made the problem pretty clear. Core inflation remains around 3.6%, still above the RBA’s 2–3% target band, while higher oil and energy prices threaten to feed through into transport, manufacturing and eventually everyday consumer prices. The question for the RBA is whether the three increases already delivered this year have done enough, or whether households need to absorb another turn of the interest-rate screw.

The timing is particularly uncomfortable because Australia’s labour market is beginning to soften at the same time. That leaves the RBA balancing two competing problems: inflation that remains too high and an economy that is showing signs of slowing. Another 0.25% increase would take the cash rate to its highest level in almost 15 years, with markets already considering the possibility that rates could eventually reach 4.85% if inflation refuses to settle.

Gold and silver, meanwhile, appear to be waiting for the central banks to show their hands. The US Federal Reserve lifted rates by 0.25% last week, its first increase in more than three years, taking its target range to 3.75–4.00%. Importantly, Fed policymakers have indicated that further tightening may still be required, meaning markets are now trying to determine how quickly the next increase could arrive.

That uncertainty has taken some momentum out of precious metals. Gold slipped more than 1% earlier this week as expectations of further US rate rises strengthened the US dollar, while silver has also pulled back from its recent highs. Higher interest rates generally create pressure for gold and silver because investors can earn better returns from interest-bearing assets, but persistent inflation and geopolitical uncertainty continue to provide support on the other side of the equation.

For now, neither metal appears particularly interested in making a decisive move. With an Australian rate decision arriving next week and the Fed signalling that its own hiking cycle may not be finished, gold and silver are effectively sitting between two opposing forces: higher interest rates pushing against prices, and persistent inflation supporting the case for holding precious metals.

This article is general market commentary only and should not be relied upon as personal financial advice. Consider the information carefully, conduct your own independent assessment and seek professional advice where appropriate before making any investment decision.
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Gold daily chart, with 50MDA