Gold Prices Decline as Dollar Strengthens Post Fed Decision

Gold prices fell by Rs 612 per 10 grams in domestic futures trade due to a strengthening dollar following the Federal Reserve's cautious policy stance. Similar declines were seen in silver prices. The central bank's outlook influenced bullion markets after its first 25 basis point rate cut of 2025.

Gold prices fell by Rs 612 to Rs 1,09,210 per 10 grams in Thursday's domestic futures trade, as speculators reduced positions following a firmer dollar recovery. This comes after the US Federal Reserve's cautious stance tempered the recent gold rally.

At the Multi Commodity Exchange (MCX), gold futures for October delivery decreased by 0.56%, while the December contract also dropped by 0.51%, reflecting similar downtrends in silver prices. The Federal Reserve's policy announcement of a 25 basis point rate cut for 2025 shifted market expectations.

Despite an anticipated rate cut, economic activity has moderated, with job gains slowing and inflation remaining somewhat elevated. The potential for additional rate cuts may lend support to gold prices medium-term. The dollar index rose, further affecting gold and silver futures, as investors reevaluated the Federal Reserve's policy outlook.

(With inputs from agencies.)