Gold Prices Dip as Fed Signals Hawkish Stance on Rates

Gold and silver prices have taken a noticeable hit following hawkish comments from US Federal Reserve officials, which have dampened expectations for imminent rate cuts. According to the Times of India, gold futures for December delivery on the Multi Commodity Exchange slipped by Rs 1,229 or 0.99 percent to Rs 1,22,332 per 10 grams.

The February 2026 contract also fell by Rs 1,207, or 0.96 percent, to Rs 1,24,101 per 10 grams, marking a significant retreat after a strong rally just the previous week. Silver futures also faced losses, with the December contract dropping by Rs 1,944, or 1.25 percent, to Rs 1,54,074 per kilogram, while the March 2026 contract fell by Rs 1,971, or 1.24 percent, to Rs 1,56,862 per kilogram.

Analysts observed that the recent retreat in precious metals comes as traders position themselves ahead of a busy week of delayed US economic data releases, including the crucial non-farm payrolls report, which is expected to offer vital clues on the Fed's policy path moving forward.

Meanwhile, a stronger dollar, which was reported to be up 0.17 percent at 99.46, has also added pressure on gold prices. In global markets, Comex gold futures for December delivery fell by 0.42 percent to $4,077.04 per ounce, following a rise of $84.4, or 2.10 percent, in the prior week.

Silver declined by 0.28 percent to $50.54 per ounce as investors brace for a flurry of US economic indicators, Fed meeting minutes, and speeches from key officials, including Chair Jerome Powell. This shift in sentiment comes after a week where gold futures had gained Rs 2,494, or 2.06 percent, reflecting a volatile market influenced by broader economic signals.

The hawkish tone from the Fed has raised concerns that monetary easing may not be on the immediate horizon, impacting the attractiveness of gold and silver as safe-haven assets for investors. As the Fed continues to signal a more aggressive stance on interest rates, market dynamics around precious metals could remain under pressure in the near term, highlighting the importance for investors to stay attuned to central bank communications and economic data releases that could shape market perceptions in the coming weeks.