Gold Prices Volatile Ahead of US Federal Reserve Decision

Gold and silver prices are experiencing volatility ahead of the US Federal Reserve's policy decision on Wednesday. The MCX silver futures for September 2026 delivery dropped by Rs 1,011 to Rs 2,31,679 per kg over two days. In contrast, gold futures for October 2026 delivery remained steady at Rs 1,52,608 per 10 grams.

Financial markets are anticipating a 25 basis point rate hike by the Fed, which would increase the benchmark rate to 3.75%-4.00%. Higher interest rates tend to reduce the appeal of gold as investors seek higher-yielding assets. However, gold is often viewed as a hedge against inflation and geopolitical risks.

Manoj Kumar Jain of Prithvi Finmart expects gold and silver prices to remain volatile this week due to fluctuations in crude oil prices and the dollar index. He recommends long-term investors to accumulate gold and silver during market falls, while traders should wait for the FOMC meeting outcome before taking fresh positions.