Gold hits weekly high as Fed rate hike cools inflation fears

Gold December futures (GC=F) opened at $4,381.60 per troy ounce on Friday, September 18, 2026, down 0.4% from Thursday's close. By 6:46 a.m. ET, the price had climbed to $4,421.40, breaking above the $4,400 threshold after holding in the $4,300 range since the previous Friday. The metal reached a weekly high of $4,439.80 during the morning session.

The price movement coincides with the Federal Reserve's decision to raise interest rates for the first time in three years. This action, combined with the ongoing restoration of Saudi Arabia's key East-West pipeline, has led to a fading of inflation concerns among investors. The decline in inflation anxiety has weighed on energy markets, with Brent crude (BZ=F) prices dropping significantly over the week. On Wednesday, Brent was trading above $107 a barrel; by Thursday morning, it fell below $100, and it stood at $98.46 as of 6:39 a.m. ET on Friday.

Despite the short-term dip at the open, gold's performance over longer periods remains strong. The opening price on Friday was up 0.5% compared to one week ago. Over one month, gold is down 2.1%, but it is up 18.7% from one year ago. For context, the one-year gain for gold reached 95.6% on January 29.

Market participants remain divided on the appropriate role for gold in a diversified portfolio. Robert R. Johnson, a professor at Creighton University's Heider College of Business, advises against investing in gold, arguing that the tradeoff between slightly dampened volatility and lost long-term return is not prudent for investors with long time horizons.

In contrast, Brett Elliott, director of content and SEO at American Precious Metals Exchange (APMEX), suggests allocations based on investor goals. Elliott recommends a 10% to 15% allocation for growth-oriented investors and a smaller 2% to 5% position for income investors, noting that gold provides no yield.

Blake McLaughlin, executive vice president at Axcap Ventures, cites historical data to support a 5% to 8% allocation. McLaughlin states that while gold may not offer outsized return potential compared to private investments, its resilience amid economic uncertainty and geopolitical unrest are attributes increasingly hard to ignore.

Thomas Winmill, portfolio manager at Midas Funds, advocates for a long-term gold allocation of 5% to 15%, specifically through mutual funds investing in gold mining companies. Winmill advises that risk tolerance and the current mix of financial versus hard assets should guide the appropriate allocation percentage.

Vince Stanzione, CEO and founder at First Information, recommends a higher 20% allocation in physical gold or a gold ETF. Stanzione argues for this exposure as a wealth protection strategy, stating that gold keeps pace with inflation and retains purchasing power while paper currencies devalue.