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Gold Plunges 3% to 8-Week Low Amid US-Iran Tensions, Fed Hike Fears
M
Moneycontrol•28-09-2026, 19:59
Gold Plunges 3% to 8-Week Low Amid US-Iran Tensions, Fed Hike Fears
- •Spot gold fell 3.01 percent to just above $4,150 per ounce, hitting an 8-week low, with US gold futures also down 3.03 percent.
- •Rising Brent crude prices, a stronger dollar, and increased US 10-year Treasury yields pressured bullion after the US rejected Iran's Strait of Hormuz proposal.
- •Domestic spot gold in India declined 2.63 percent to Rs 1,47,394 per 10 grams, with futures also seeing a 2.84 percent drop.
- •Uncertainty surrounding the US-Iran conflict and potential Fed rate hikes continue to fuel volatility in safe-haven demand.
- •Despite price drops, central banks like China and Poland are buying gold, and Indian physical demand is modestly improving ahead of the festive season, potentially limiting further corrections.
Key Questions Answered
Spot gold dropped 3.01% to around $4,150 per ounce due to a stronger dollar index exceeding 101, rising US 10-year Treasury yields near 5.2%, and Brent crude futures climbing above $108.04 after the US rejected Iran’s proposal to reopen the Strait of Hormuz.
Domestic spot gold on the MCX fell 2.63% from a previous close of Rs 1,51,377 to Rs 1,47,394 per 10 grams on September 28, 2026, while December 4 gold futures declined 2.84% to Rs 1,48,923 per 10 grams.
The People's Bank of China bought 20.2 tonnes of gold in August, Poland remained a major buyer, and European funds saw positive gold ETF inflows. Additionally, lower prices have modestly improved physical demand in India ahead of upcoming festivals like Navratri, Dhanteras, and Diwali.
