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Gold and Silver Prices Fall Sharply Amid Inflation Fears, Tighter US Monetary Policy

· · 2 min read

Gold and silver prices extended their decline on October 30, with international gold slipping below $4,000 per ounce. Persistent inflation concerns and expectations of tighter US monetary policy are driving the sustained selling pressure.

Precious Metals See Significant Drop

On October 30, 2026, both gold and silver futures experienced a notable decline, driven by investor concerns over persistent inflation and the prospect of stricter US monetary policy. International gold futures fell below the crucial $4,000 per ounce mark, while silver neared the $50 level.

On the Multi Commodity Exchange (MCX), December gold futures were down 0.57% to Rs 1,41,790 per 10 grams. Silver futures saw a more pronounced drop, declining 1.96% to Rs 1,85,735 per kg. In international markets, December gold futures decreased by 0.76% to $4,000 per ounce, and silver fell 2.13% to $51 per ounce.

Key Factors Driving the Decline

According to Sugandha Sachdeva, Founder of SS WealthStreet, the current correction in precious metals reflects growing pressure from several economic and geopolitical factors:

  • Inflation Concerns: Persistent inflation remains a primary worry, with US PCE inflation rising to 3.6% in September (core PCE at 3.1%).
  • Tighter US Monetary Policy: The US Federal Reserve has maintained its interest rates but hinted at a potential rate hike in December, keeping the possibility of higher-for-longer rates alive.
  • Resilient US Economy: Strong third-quarter US GDP growth of 3.4% (above expectations) further supports the narrative that interest rates may remain elevated, diminishing the appeal of non-yielding assets like gold and silver.
  • Geopolitical Tensions: Escalating US-Iran tensions have contributed to elevated crude oil prices, fueling fears of energy-driven inflation. While geopolitical uncertainty often boosts gold's safe-haven appeal, the current inflationary impact is overriding this support.

Outlook and Key Levels to Watch

From a technical perspective, Sachdeva indicates that the near-term outlook for precious metals remains under pressure. Investors should monitor key support and resistance levels:

International Market

  • Gold: Immediate support is identified in the $3,950-$3,970 zone, with reclaiming $4,000 being a critical resistance.
  • Silver: The next major support level is $48, while $53 is expected to act as immediate resistance.

Domestic Market (MCX)

  • Gold: Key support levels are Rs 1,41,500, followed by Rs 1,40,000 and Rs 1,37,000. Significant resistance is at Rs 1,45,000.
  • Silver: Support levels are at Rs 1,80,000 and Rs 1,73,000, with Rs 1,97,000 serving as a crucial resistance point.

Moving forward, crude oil prices, upcoming US inflation data, signals from the Federal Reserve, and developments in the Gulf region will be crucial triggers for precious metals. A reduction in geopolitical tensions and a meaningful correction in crude oil prices could ease inflationary pressures and pave the way for a recovery in gold and silver values.

Note: Support and resistance levels are analyst estimates and not guaranteed price targets.

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