Gold Price Plunges 6.5% in Worst Monthly Performance Since June
Gold prices plummeted by 6.5% in September, marking its worst monthly performance since June. This sharp correction came on the back of monetary tightening by the US Federal Reserve and rising bond yields.
The key pressure point was the US bond market, where global bond yields rose during September due to concerns over mounting government debt and fiscal deficits. Higher yields increase the opportunity cost of holding non-yielding gold, making it relatively less attractive.
Geopolitical developments added another layer of uncertainty, with Iran's latest proposal to revive the Gulf ceasefire still pending and US President Donald Trump's rejection of it adding to tensions.
Despite the correction, analysts remain optimistic about gold's prospects in October. Rajeev Sharan, Head of Research at Brickwork Ratings, said that safe-haven buying amid geopolitical tension, sticky inflation, and steady central bank purchases will continue to support the metal.