Gold Prices Hit 13-Month Low Amid Fed Rate Warnings

Gold prices dropped 3 percent on Thursday, hitting a 13-month low as spot gold bottomed at $3,853 per troy ounce. The decline followed strong US consumer price inflation data and a series of hawkish signals from the Federal Reserve System, which increased market expectations for continued policy tightening. This trend was reflected globally, with Comex gold futures falling 1.06 percent and domestic gold futures on India's Multi Commodity Exchange dropping 0.86 percent to ₹1,38,509 per 10 grams.

Federal Reserve policymakers emphasized the need for further action to stabilize prices. Lorie Logan advocated for at least two more 25-basis-point rate increases, while Michelle Bowman noted that inflation pressures are persisting. Christopher Waller stressed the importance of implementing promised hikes regardless of precise timing. These signals, combined with a rebounding US dollar and rising Treasury yields, pressured precious metals, sending silver below $50 per ounce to an 11-month low.

Market volatility extended to other sectors. Crude oil prices rallied after President Donald Trump stated on social media that the United States did not need a deal with Iran, dampening hopes for Middle East peace. Meanwhile, Nvidia shares sank to a 16-month low following the resignation of CEO Jensen Huang amid allegations of personal misconduct. Despite the gold sell-off, sustained purchases by the People's Bank of China and other central banks limited the extent of the price correction.