Fed Pause Expectations Lift Metals (10.19.2026)

Growing expectations for a Federal Reserve pause in October supported precious metals as investors responded to dovish remarks from Fed Chair Kevin Warsh. 

Gold climbed above $4,170 and silver extended its recovery above $57, benefiting from safe-haven demand amid equity market weakness and geopolitical uncertainty. Meanwhile, the euro slipped below 1.12 as widespread European unrest and renewed attacks on energy infrastructure raised economic concerns. Sterling strengthened toward 1.325 following resilient UK growth data, while the yen remained near 158 as Bank of Japan officials signaled progress toward their inflation target.

Euro Drops Below $1.12

The euro fell up to 0.5% to $1.118 on Monday before recovering a portion of its losses. Weekend civil unrest across France, Belgium, Italy, and Portugal escalated into violent clashes between police and protesters, dampening sentiment surrounding the single currency. Geopolitical friction intensified as Russian and Ukrainian forces continued targeting energy infrastructure, including Ukrainian strikes on oil facilities in St. Petersburg. Elevated energy prices threaten to hamper European growth while maintaining elevated inflation, leaving the euro vulnerable to further downside should regional instability persist.

The first resistance is positioned at 1.1260 while the support starts from 1.1180.

Gold Rises Above $4,170

Gold advanced above $4,170 per ounce on Monday, extending gains after dovish remarks from Federal Reserve Chair Kevin Warsh prompted traders to scale back October rate hike expectations. Speaking at the IMF annual meetings in Bangkok, Warsh offered no explicit guidance on the upcoming FOMC decision, though he noted higher inflation had not altered his broader economic outlook. With the central bank entering its blackout period ahead of the October policy meeting, markets price roughly an 84% probability of rates remaining unchanged.

First resistance is seen at $4200, with initial support near $4150.

Yen Holds Near 158

The Japanese yen traded in a narrow range around 158 per dollar on Monday. Bank of Japan Governor Kazuo Ueda provided a slightly hawkish signal, stating underlying inflation is approaching the central bank's 2% target. He attributed persistent price pressures to a moderate economic recovery and a tight labor market. Meanwhile, Prime Minister Sanae Takaichi pledged to maintain annual government bond issuance at an appropriate level, offering additional stability to domestic financial markets.

First resistance is seen at 158.40, with initial support near 157.50.

Sterling Rises Toward $1.325

The pound climbed toward $1.325 following UK GDP figures that revealed stronger August growth, lifting expectations of a Bank of England rate increase next month. Monthly output expanded 0.1% after a 0.4% gain in July, bringing three-month growth to 0.7%. Resilient economic activity alongside energy market disruptions linked to the Iran conflict could heighten inflation risks as markets await the October 28 budget.

From a technical view, resistance stands near 1.3370, with support around 1.3300.

Silver Advances Above $57

Silver advanced above $57 per ounce on Monday, extending gains after dovish remarks from Federal Reserve Chair Kevin Warsh prompted markets to scale back October rate hike expectations. Speaking at the IMF annual meetings in Bangkok, Warsh noted that recent inflation data had not altered his broader economic outlook. With the Fed now in its blackout period ahead of the October 27–28 decision, markets price an 84% likelihood of a policy hold. Precious metals also gained safe-haven support as tech sector anxiety prompted stock market selling, while geopolitical friction kept oil prices elevated.

From a technical view, resistance stands near $58.20, while support is located around $57.00.