Gold Prices Plummet Amid Rate Hike Fears and Surging Crude Oil
Gold prices have taken a hit this week, falling nearly 2% as investors grow increasingly concerned about the potential for a Federal Reserve rate hike and stubborn US inflation. The price of gold on the Multi Commodity Exchange (MCX) for October slipped 0.08% to ₹1,52,655 per kilogram, while September silver futures declined by 0.04% to ₹2,34,886 per kg.
The sharp increase in crude oil prices has also contributed to inflation worries, with WTI crude rising above $104 per barrel and gaining around 9.6% over five sessions. This surge in energy costs has strengthened concerns that higher energy costs could keep inflation elevated and force the Federal Reserve to maintain a tighter monetary policy.
The US headline inflation increased 0.4% month-on-month and 3.4% year-on-year in August, with energy costs contributing to the increase. Producer inflation also accelerated to 5.4% annually, slightly above market expectations.