Gold rates today under pressure after US Fed rate cut. Will it fall further?

Gold rate today: After climbing to a new peak of ₹1,06,666 per 10 gm on MCX (Multi Commodity Exchange), gold prices came under pressure and retraced around 0.50 per cent from their fresh peak made last week. This fall in the gold prices was mainly caused by the bounce back in the US dollar rates after the 25 bps US Fed rate cut. However, MCX gold rates registered a gain for the fifth straight week. Gold future contract for October 2025 expiry on MCX ended at ₹1,09,900 on Friday last week. In the international market, COMEX gold price touched a new peak of $3,707.65 per troy ounce last week.

According to market experts, gold prices generally rise after a US Fed rate cut, but this was not witnessed last week as US dollar rates bounced back after the US Fed meeting. However, value picking was seen at lower levels and gold prices bounced back after losing around 0.50 per cent from its fresh peak of ₹1,06,666 per 10 gm in the domestic market and $3,707.65 per troy ounce in the international market, They said that MCX gold rates may touch ₹1,12,000 per 10 gm and COMEX gold prices may soon touch $3,750 per troy ounce.

Speaking on the gold price performance last week, Sugandha Sachdeva, Founder of SS WealthStreet, said, “Gold prices marked another milestone during the week, scaling a fresh peak of ₹1,06,666 per 10 gm, before settling with modest weekly gains of 0.50%, thereby extending their winning streak to the fifth consecutive week. On the international front, the yellow metal touched a new all-time high of $3,707.65 per ounce.”

On triggers that dominated gold price movement last week, Sugandha Sachdeva said, ‘The key highlight of the week was the US Federal Reserve meeting, where the Fed, in line with expectations, cut rates by a quarter percentage point, its first reduction in nine months and signalled the likelihood of two more rate cuts this year. Lower interest rates generally boost gold’s appeal by reducing the opportunity cost of holding the non-yielding asset. However, the Fed maintained a cautious tone, describing the move as a “risk management” step in response to signs of a cooling US labour market.”

Why did gold prices dip after the US Fed rate cut?

“The 25 bps reduction was expected and already factored into the market, creating a ‘buy the rumour, sell the fact’ situation. Traders who were positioning for the easing cycle banked their profits after the all-time high, causing near-term selling pressure. Gold historically shines in rate-cutting cycles when inflation is still high,” said Puneet Singhania, Director at Master Trust Group.

Ross Maxwell, Global Strategy Lead at VT Markets, said, “While rate cuts typically support gold (by lowering the opportunity cost of holding non-yielding assets), the FED emphasised data dependency and stated that policy decisions remained challenging, suggesting future cuts would be more gradual. Also, a rebound in the USD and rising US Treasury yields after Fed Chair Powell’s comments tempered expectations, which generally move in the opposite direction for gold.”

On reasons that triggered renewed buying after the US Fed rate cut announcement, Sugandha Sachdeva said, “Renewed buying interest has been driven by market expectations of further Fed easing, with one additional rate cut already priced in for the October policy meeting. Moreover, sustained central-bank purchases and growing concerns over the Fed’s independence continue to lend support to gold.”

Is it the right time to buy gold?

On whether gold prices would fall after the recent bounce back, Ross Maxwell of VT Markets said, “Outlook for gold rates today remains bullish. Slowing US growth, inflation risks, central bank demand, and forecasts of more rate cuts later this year are supportive over the long term. But downside risks remain in the short-term. If rate cut expectations are delayed, or economic data remains stronger than feared, this could put further pressure on gold. But over a longer-term projection, if rate cuts proceed, inflation stays elevated, or the USD weakens, gold could regain strength and maybe move back and make record highs.”

Puneet Singhania of Master Trust Group unveiled the strategy for gold investors after the announcement of the US Fed rate cut: “Long-term investors would buy on dips, emphasising gold as an inflation and risk hedge. Spread positions and monitor such major events as the October jobs report and November Fed meeting to get directional signals.”

On triggers that may dominate gold prices in the near-term, Sugandha Sachdeva said, “Going forward, market focus will shift to the release of the US PCE Price Index (August), Q2 GDP data, and speeches by Fed officials, which are expected to provide further directional cues for gold and silver. Given the heightened volatility in the domestic currency, any significant appreciation or depreciation of the Indian rupee will have a direct bearing on gold prices in the domestic market.”

Gold rate today: Key levels to watch

Expecting the gold rush to continue, Sugandha Sachdeva of SS WealthStreet said, “The overall trend for gold remains firmly bullish. While intermittent dips cannot be ruled out, prices are poised to climb higher towards ₹1,12,000 per 10 gm domestically, and $3,750 per ounce (spot) internationally. On the downside, immediate support is pegged at ₹1,08,500 and ₹1,05,800 per 10 gm, while in global markets, the critical floors lie at $3,620 and $3,540 per ounce.”

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.