Gold Prices Crash Rs 3,900 as Fed Rate Cut Hopes Dim
Gold prices witnessed a sharp decline of Rs 3,900, settling at Rs 1,25,800 per 10 grams in Delhi on Tuesday. The drop mirrored a global selloff driven by receding expectations of an immediate interest rate cut from the US Federal Reserve.
Key Takeaways
- Gold plunged by Rs 3,900 to Rs 1,25,800 per 10 grams.
- Silver also tumbled by Rs 7,800 to Rs 1,56,000 per kg.
- Global spot gold fell for the fourth straight session to USD 4,042.32/oz.
- Probability of a December Fed rate cut dropped sharply from 63% to 41%.
Domestic Market Impact
According to the All India Sarafa Association, gold of 99.5% purity tanked to Rs 1,25,200 per 10 grams (all taxes included). Silver prices were also under significant pressure, with the white metal tumbling by Rs 7,800 to Rs 1,56,000 per kilogram.
Expert Analysis on Fed Policy
Market experts attributed the selloff to fading hopes for US interest rate cuts.
“A rate cut in December has become less likely due to the absence of US data over the last six weeks and hawkish comments made by a number of Fed officials,” said Renisha Chainani, Head of Research at Augmont.
Global Gold Trends
In international markets, spot gold extended its decline for the fourth consecutive session, slipping to USD 4,042.32 per ounce. The precious metal has dropped by USD 152.82, or 3.64%, from the USD 4,195.14 an ounce recorded on November 12.
“Spot gold has extended its decline to the fourth straight day as doubts about the Fed rate cut linger amid hawkish comments from Federal Reserve officials,” said Praveen Singh, Head of Commodities at Mirae Asset ShareKhan. “The rate cut probability in December has fallen to 41%, down sharply from around 63% as seen on November 5.”
In a contrasting move, spot silver snapped its three-day losing streak, gaining 0.57% to USD 50.49 an ounce.
