Gold Crashes ₹3,000 in 10 Days to ₹1.42 Lakh as Fed Decision Weighs on Bullion

The Quick Take

• Gold December futures fell to ₹1,42,216 per 10 grams, a decline of over ₹3,000 in the past 10 trading sessions.
• Pressure ahead of the US Federal Reserve's October 27-28 meeting has been the primary catalyst for the price correction.
• Technical indicators point to continued near-term weakness unless the Fed signals an unexpectedly dovish stance.

Gold prices in India extended their correction, with December futures sliding to ₹1,42,216 per 10 grams as the US Federal Reserve's two-day policy meeting dominated sentiment in bullion markets. The roughly ₹3,000 decline over 10 sessions reflects a combination of dollar strength ahead of the Fed decision and a reduction in safe-haven demand as equity markets stabilized. Gold's inverse correlation with real interest rates makes it particularly sensitive to any upward revision in the Fed's rate outlook.

The near-term trajectory for gold depends heavily on whether the Federal Reserve's statement and press conference introduce any hawkish nuance — even a subtle shift in language toward 'higher for longer' could push real yields up and gold down further. On the other hand, any dovish surprise (rate cut signal, concern about growth slowdown) would likely trigger a sharp gold recovery toward recent highs. Indian physical demand provides a floor: with Diwali and wedding season approaching, jewellers and retail buyers tend to treat price dips as accumulation opportunities, softening downside beyond a certain level.

Technical analysis flagged by market observers points to continued near-term weakness for gold, suggesting the current correction may have further to run before support levels are tested. Watch the ₹1,40,000 level as a key psychological support for domestic futures. The macro variable is the real 10-year US Treasury yield — if it rises above 2.5% on a sustained basis post-Fed, gold's fundamental support weakens materially. Conversely, any signs that the US economy is slowing faster than expected would rebuild the safe-haven bid.

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