Gold Prices Plunge Amid US Rate Hike Bets and Stronger Dollar

Gold prices have dropped nearly 9% from their August peak due to rising US bond yields, a stronger dollar, and growing expectations of a US Federal Reserve rate hike.

The recent correction has brought gold back into focus for investors, who are weighing whether to accumulate at current levels or wait for prices to fall further.

Gurmeet Singh Chawla, managing director at Master Portfolio Services, said that a Fed rate hike would likely be negative for gold in the near term, as it increases the opportunity cost of holding the metal.

However, Chawla believes that one potential rate hike does not necessarily mark the end of the broader gold bull cycle.