Gold Prices Decline Amid US Monetary Policy Shifts and Rising Crude Oil

Gold prices have seen a significant decline of nearly 3% over the past week, driven by changes in US monetary policy and rising crude oil prices that have heightened inflation concerns. As geopolitical tensions and strong US labor data influenced market dynamics, analysts noted a shift in sentiment. The latest data indicates immediate resistance and support levels for gold, reflecting the ongoing volatility in the precious metals market. This article delves into the factors affecting gold prices and what to expect moving forward.

By Narendra Chaudhary Sep 5, 2026, 15:44 IST

Gold Market Update

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New Delhi, Sep 5: Gold prices experienced a nearly 3% decline over the week, influenced by adjustments in US monetary policy and a spike in crude oil prices, which raised inflation worries.

On Friday, MCX gold futures for October saw a slight increase of 0.03%, while MCX silver futures for September dropped by 0.07%. The price of gold was recorded at Rs 1,52,815, whereas silver was priced at Rs 2,37,500.

The cost of 10 grams of 24-carat gold was Rs 1,54,884 on Friday, a decrease from Rs 1,59,578 the previous week, as reported by the India Bullion and Jewellers Association (IBJA).

Precious metals had reached a three-month peak earlier in the week following a significant sell-off, but a final pullback occurred on Friday as markets responded to a combination of geopolitical tensions, changing expectations from the Federal Reserve, and unexpectedly strong US labor data.

A robust jobs report for August on Friday reversed much of the dovish sentiment surrounding the US Federal Reserve in just one session, according to market analysts.

Initially, bullion prices were supported by geopolitical uncertainties and a weaker US dollar. However, the intensification of the US-Iran conflict, particularly Iran's retaliatory actions against Kuwait after renewed US strikes on Iranian positions near the Strait of Hormuz, led to a surge in crude oil prices, negatively impacting gold.

The rising inflation concerns stemming from the crude oil price increase significantly heightened expectations for a Federal Reserve rate hike in September.

Increasing Treasury yields and a stronger dollar ultimately diminished safe-haven demand, resulting in a notable correction in precious metals.

The market sentiment shifted again midweek after disappointing US labor market data and dovish comments from the Federal Reserve rekindled hopes for a less aggressive monetary policy approach.

However, this rebound was short-lived as Friday's employment report for August significantly surpassed expectations. The stronger job figures led to a sharp rise in Treasury yields and the US dollar, reversing much of the previous dovish outlook, according to analysts.

Immediate resistance for Comex Gold is identified in the Rs 1,500–1,530 range, while support is found in the Rs 1,330–1,360 range, analysts noted.

For MCX gold, immediate resistance is seen at Rs 1,56,500–Rs 1,57,000, with support at Rs 1,51,500–Rs 1,52,000.