Gold Prices Tumble on Higher US Inflation Rates

The US inflation report released on Tuesday showed higher-than-expected inflation rates, which has reinforced expectations that the Federal Reserve will maintain its hawkish stance and keep interest rates higher for longer.

This scenario is negative for gold prices, as investors typically lose favor when interest rates rise. Spot gold fell 2.3% to $1,820 per ounce by mid-session, breaking below key support levels.

The inflation data has effectively closed the door on near-term rate cuts, according to market analyst David Carter of Boldwater Advisors. The selloff reflects a broader recalibration across precious metals, with silver falling 3.1% and platinum dropping 2.5%.