Gold Prices Hit 13-Month Low Amid Inflation Concerns

New Delhi, November 13: Gold prices have seen a significant decline, reaching a 13-month low due to ongoing inflation in the United States and fears of interest rate hikes by the Federal Reserve. Currently, gold is trading around $3,880 per ounce in the international market. In the previous trading session, gold prices dropped by nearly 3%, marking a substantial decrease.

On the Multi Commodity Exchange (MCX), gold closed at approximately ₹1.36 lakh per 10 grams on Thursday night. In the local jewelry market, gold prices fell by about ₹3,000, closing at ₹137,692 per 10 grams. Meanwhile, silver prices remained at ₹178,848 per kilogram.

Reasons for the Decline in Gold and Silver Prices

The primary reason for the drop in gold prices is the unexpectedly high inflation figures in the United States. This has led investors to believe that the Federal Reserve may increase interest rates further to control inflation. This expectation has also impacted U.S. bond yields, with some U.S. Treasury bond yields rising by more than 12 basis points on Thursday.

Market speculation suggests that the Federal Reserve may raise interest rates by 0.25% in its meeting next month, with some investors anticipating a possible increase of 0.50%. It is believed that rate hikes may continue even after December.

Additionally, tensions with Iran have led to an increase in crude oil prices. U.S. President Donald Trump has indicated that the U.S. does not need a deal with Iran and has kept military action as an option. Following this statement, Brent crude prices surged to nearly $96 per barrel.

Minor Recovery in Gold and Silver Prices on Friday

However, on Friday, early trading saw a slight recovery in the international market, with spot gold rising by 0.1% to $3,881.02 per ounce. Silver also experienced a 0.2% increase, trading at $50.11 per ounce.