Gold prices came under pressure on September 20, 2025, after reaching a fresh peak of Rs. 1,06,666 per 10 gm on MCX. The price drop came after the announcement of the US Federal Reserve’s 25 basis points rate cut and a rebound in the US dollar. Despite the recent dip of around 0.50%, domestic gold has recorded gains for the fifth consecutive week, with October 2025 gold futures closing at Rs. 1,09,900. Internationally, COMEX gold touched an all-time high of $3,707.65 per troy ounce last week.
Gold prices on ET Markets show a dip of 0.70% at press time:
Traditionally, a US Fed rate cut boosts gold appeal, as lower interest rates lower the opportunity cost of holding a non-yielding asset. However, market experts noted that the dip was due to a ‘buy the rumour, sell the fact’ scenario. Traders booked profits after gold’s record highs, while the US dollar strengthened following Fed Chair Jerome Powell’s comments about data-dependent, gradual policy easing.
Despite short-term pressure, investors continued buying gold at lower levels. Experts say that this is due to expectations of further Fed rate cuts, central bank purchases, and inflation concerns. Sugandha Sachdeva, Founder of SS WealthStreet, noted that gold remains attractive for investors seeking a hedge against inflation and global uncertainties.
Analysts expect MCX gold prices to potentially reach Rs. 1,12,000 per 10 gm, while COMEX gold could hit $3,750 per troy ounce. Immediate support levels for domestic gold are Rs. 1,08,500 and Rs. 1,05,800 per 10 gm, with global floors at $3,620 and $3,540 per ounce.
Experts advise long-term investors to buy on dips, while keeping an eye on upcoming US economic data such as the PCE Price Index, GDP updates, and Fed statements for directional cues. Short-term volatility may continue. However, gold prices’ long-term trend remains bullish, supported by inflationary pressures, central bank demand, and expectations of additional US rate cuts later this year.