Gold Prices Plummet ₹8,500 in 10 Days Amid Rising Yields and Dollar Strength

Gold prices have been under pressure in recent days, falling ₹8,500 over the past 10 days to reach a seven-week low. The MCX October gold contract dropped 0.20% to around ₹1.46 lakh per 10 grams on Tuesday.

The decline is attributed to rising US Treasury yields, a stronger dollar, and expectations that the Federal Reserve could keep interest rates higher for longer. Higher bond yields make non-yielding assets like gold less attractive, while a firmer dollar adds pressure on the metal.

Kaynat Chainwala, AVP, Commodity Research at Kotak Securities, said spot gold is attempting a recovery and is hovering around $4,140 an ounce after yesterday's sharp 4% decline. She noted that stalled US-Iran talks pushed oil prices higher and strengthened expectations that the Fed could remain hawkish for longer.

The next major trigger for bullion will be US economic data due this week, particularly the Core PCE Price Index, unemployment data, and non-farm payrolls. A hotter-than-expected PCE reading or stronger payrolls could keep yields and the dollar elevated, while softer data or a more patient Fed could trigger a relief rally.