Gold Prices Plummet Below Rs 1.5 Lakh Amidst Tightening Monetary Policy

Gold prices have plummeted below the Rs 1.5 lakh mark per 10 grams, settling at a seven-week low amidst expectations of tighter US monetary policy.

The recent decline has been driven by higher US Treasury yields, which have increased the cost of holding non-yielding assets such as gold.

The US 10-year Treasury yield has climbed to around 5.25 per cent, while the 30-year yield has risen to about 5.56 per cent, making interest-bearing assets more attractive relative to gold.

Markets are also pricing in a higher chance of another US rate hike, with the CME FedWatch tool putting the probability above 70.3 per cent.