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Gold Prices Plunge 20%: Will Federal Reserve's Decision Drive Further Decline?
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News18•03-10-2026, 13:20
Gold Prices Plunge 20%: Will Federal Reserve's Decision Drive Further Decline?
- •Gold prices have fallen 20% this year, an unusual trend during geopolitical tensions.
- •Spot gold dropped 0.9% globally, futures fell 1%, with a 3.4% weekly decline.
- •US-Iran conflict raises fears of crude oil and commodity price hikes, fueling inflation.
- •Federal Reserve may raise interest rates to curb inflation, potentially lowering gold prices further.
- •Indian markets were closed for Gandhi Jayanti; international price drops may impact Monday's trading.
Key Questions Answered
Markets fear the US-Iran conflict will drive up crude oil and essential commodity prices, causing runaway global inflation. To curb this inflation, the US Federal Reserve and other central banks are expected to raise interest rates, diminishing gold's appeal as a non-yielding asset.
Spot gold closed down by approximately 0.9 percent at $4140 per ounce, while gold futures fell by 1 percent to $4162 per ounce, contributing to a weekly decline of about 3.4 percent.
The Indian bullion market and MCX were closed due to the Gandhi Jayanti holiday, preventing the direct impact of international gold price drops from immediately reflecting locally.
