Gold, Silver Prices Plummet Amid Inflation Concerns and Tighter Fed Policy

Gold and silver prices fell sharply on the Multi Commodity Exchange (MCX) on Monday, September 28. Gold declined over 2% to ₹1.50 lakh per 10 grams for December delivery, while silver dropped nearly 3% to ₹2.28 lakh per kg.

The decline comes as concerns about inflation rise and expectations grow that the US Federal Reserve may maintain a tighter monetary stance. Higher interest rates and bond yields typically weigh on non-yielding assets like gold.

Nirpendra Yadav, Senior Research Analyst at Bonanza, pointed to the shift in the near-term macro environment, citing higher oil prices adding to inflation concerns and pushing US Treasury yields and the dollar higher.

Vedika Narvekar, Research Analyst, Commodities & Currencies at Anand Rathi Share and Stock Brokers, noted that ongoing uncertainty around the Strait of Hormuz is keeping oil prices elevated and inflation concerns alive.