Gold Faces ‘September Curse’ as Prices Show Signs of Slowing Momentum

Even though gold prices are trading at high levels, the momentum seems to be slowing as September arrives. Recently, investors have been hearing about the “September Curse,” a term often associated with the U.S. stock market. However, it also applies to gold. Data shows that since 2017, international gold prices have consistently declined in September for seven consecutive years, earning the label of the “September curse” in the gold market.

So far, despite some technical selling pressure, gold has managed to hold above the critical support level of $2,500 per ounce with stable prices. December gold futures last traded at $2,528.40 per ounce, marking a modest rise of 0.21% on the day.

Year	London Gold Spot	COMEX Gold Futures
2017 Sep	-3.10%	-3%
2018 Sep	-0.92%	-0.87%
2019 Sep	-3.17%	-3.34%
2020 Sep	-4.17%	-4.43%
2021 Sep	-3.20%	-3.33%
2022 Sep	-2.89%	-3.35%
2023 Sep	-4.71%	-5.15%
Average	-3.17%	-3.35%

In a recent report, Nicky Shiels, head of Metals Strategy at MKS PAMP, noted that since 2009, gold prices have averaged a 2.4% decline in September. Bloomberg analysts pointed out that since 2017, the average decline during this “September curse” period is 3.2%.

September is not only challenging for gold but also for silver. Over the past 15 years, silver prices have averaged a 3.7% drop in the last month of the third quarter.

Why Does Gold Typically Decline in September?

Analysts provide several possible reasons. For example, traders adjusting asset allocation strategies during vacation periods could lead to selling pressure on gold, an essential component in portfolios. Additionally, the Federal Reserve usually holds its monetary policy meetings in September, and a seasonal strengthening of the U.S. dollar can affect gold prices.

As for this year’s gold market, gold prices have risen over 20% so far this year. The U.S. stock market, after significant gains, faces the hurdle of high valuations, leading investors to remain cautious as the summer ends. The sluggish momentum in gold prices is also linked to the dollar, which, after reaching a one-year low last month, has begun to recover moderately.

While the “September Curse” has affected the gold market in recent years, this seasonal factor diminishes when looking at a longer period, such as the past 30 years. In fact, September sometimes turns out to be a month of gains. Even with increased volatility this year, analysts suggest the overall bullish trend in gold may remain unaffected, citing the following reasons:

• Continuous Central Bank Purchases: Central banks are expected to continue providing strong support for gold, one of the main drivers of the initial rally this March. UBS maintains that the rationale for diversification remains valid, and there is more room for official gold purchases.
• Federal Reserve Rate Cuts: The Fed is expected to begin rate cuts this month, potentially prompting Western investors to take over from Eastern counterparts in pushing gold prices to new highs. Buying gold is primarily for hedging against U.S. economic downturn risks and anticipating the upcoming Fed rate cuts. According to Natixis Precious Metals Analyst Bernard Dahdah, the average gold price in 2025 is projected to be around $2,600.
• Year-End Bull Market: Historically, the end of the year is often a bullish period for gold. Over the past 15 years, gold futures prices have risen in 13 of those years, with prices often pausing briefly in early November and then rising from Thanksgiving to the New Year.

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