Spot gold opens lower as concern about tighter monetary policy persists
This story was originally published at 14:22 IST on 25 June 2026
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By Reshma Ravi
MUMBAI – Average spot gold prices in India opened lower on Thursday, tracking futures on the Multi Commodity Exchange of India and COMEX, due to growing expectations of interest rate hikes by the US Federal Reserve this year. High US inflation, fuelled by the Iran war, and a hawkish Fed have contributed to expectations of a rate hike.
Gold of 99.9% purity opened at INR 140,022 per 10 grams, down from Wednesday's close of INR 142,178 per 10 grams. In Mumbai, spot gold opened at INR 144,000 per 10 grams. Dealers are offering a discount of INR 1,200 per 10 grams, traders said. "The correction was driven by a stronger US dollar and rising expectations that the Federal Reserve may keep interest rates elevated for longer. Market sentiment turned bearish after the Fed maintained a hawkish stance and concerns persisted that inflationary pressures from the Iran conflict could prompt further monetary tightening," analysts at Kedia Advisory said in a note. Typically, higher interest rates dim the appeal of the non-interest-bearing precious metal.
Investors now await the US Personal Consumption Expenditures data, the Fed's preferred inflation gauge, due later in the day, for further cues on monetary policy.
"In the physical market, Indian dealers widened discounts to as much as INR 6,000 10 grams, reflecting subdued demand despite prices reaching a two-and-a-half-month low," Kumar Jain, spokesperson for the India Bullion and Jewellers Association said. India's gold imports plunged nearly 70% after import duties were raised to 15%," Amit Gupta, a senior analyst at Kedia Advisory, said in a note. End
Edited by Akul Nishant Akhoury
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