Gold prices decline sharply amid rising expectations of US interest rate hikes driven by persistent inflation, higher energy costs, and geopolitical tensions impacting supply and demand dynamics.
Gold prices were under renewed pressure this week as traders grew more convinced that the Federal Reserve may keep rates elevated for longer, with higher energy costs reinforcing inflation worries and reducing demand for non-yielding assets such as bullion. According to the report by Bhaskar Live, domestic gold futures slipped on Friday, while silver also edged lower, and the Indian Bullion and Jewellers Association showed that 10 grams of 24-carat gold fell from Rs 1,54,884 a week earlier to Rs 1,51,938.
The move came as crude oil prices climbed on supply-risk fears linked to US-Iran tensions and attacks on shipping routes. Kiplinger noted that the August US consumer price report, released on 11 September 2026, was the final inflation reading the Fed was due to consider before its policy meeting, and that economists expected headline inflation to rise 0.4% month on month and 3.4% year on year. Those expectations helped keep rate-hike bets alive, even before the data were published.
That backdrop had already weighed on precious metals after Thursday’s producer-price figures showed annual inflation accelerating to 5.4%, above forecasts. LiveMint reported that market odds for a rate increase at the Fed’s 15-16 September meeting had risen sharply, while Treasury yields jumped, with the 10-year note touching 4.975% intraday and the two-year yield reaching a two-year high near 4.65%. Kitco said the stronger core inflation reading kept the September decision tilted towards another hike, even as spot gold and silver recovered part of their earlier losses.
Analysts quoted in the Indian market reports said gold now faces resistance in the Rs 1,54,000-Rs 1,54,700 range on MCX, with support near Rs 1,50,000-Rs 1,50,700. In global trade, the metal has been moving in a broad $4,300-$4,530 band, reflecting a market caught between fears of higher rates and persistent geopolitical and inflation risks.
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