Gold Prices Plummet Over $1000 as US Bond Yields Rise

Gold and silver prices plummeted on September 24 as rising US bond yields and a strong Dollar Index exerted pressure on the bullion market.

The MCX Gold, October 5 expiry, dropped Rs 1,124 to a low of Rs 1,50,175 per 10 grams, while MCX Silver, December 4 expiry, fell over Rs 2,918 to a low of Rs 2,32,600 per kilogram.

Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities, attributed the decline to rising bond yields and the Dollar Index moving above 101, increasing pressure on bullion.

The market is increasingly pricing in the possibility of another rate hike by the central bank in October, raising the opportunity cost of holding gold, according to Trivedi. He forecasted that the gold range can be seen between Rs 1,48,000, Rs 1,52,500 going ahead.

Retail gold rates also declined in the domestic market, with 24 karat (999) gold falling to Rs 1,50,785 and 22 karat (916) gold dropping to Rs 1,38,119.