Gold Prices Weighed Down by US Fed Tightening Bets
Gold prices in India continued to drift lower due to expectations of further US Federal Reserve tightening. The Fed's hawkish policy outlook, driven by stronger economic activity and rising inflation, put pressure on bullion despite continued structural support.
New York Fed President John Williams hinted at another rate hike before year-end, which increased pressure on gold prices. Goldman Sachs noted that official-sector demand remains firm, but warned that additional Fed hikes could slow near-term appreciation.
The investment bank estimated that under a more hawkish scenario involving three further rate hikes, gold could correct towards $4,070 before recovering to around $4,200 by end-2026 as central-bank purchases provide support. Physical market flows remained mixed, with Swiss gold exports rising 65% month-on-month in August, but Indian demand remaining subdued due to buyers awaiting lower prices.
The technical outlook for gold remains bearish, with open interest declining 11.61% to 5,807 and a break below ₹1,50,110 exposing ₹1,49,510. However, resistance is seen near ₹1,51,330, which could be breached if gold prices can sustain above this level.