Gold, Silver Prices Plummet Amidst Rate Hike Fears

Gold and silver prices have experienced a significant downturn on the MCX, extending losses for a second consecutive session as of June 25, 2026. This sharp decline is primarily driven by a strengthening U.S. dollar and growing anticipation of Federal Reserve interest rate hikes.

MCX silver futures for July 2026 delivery have fallen by Rs 15,526 over two days, settling at Rs 2,10,308 per kg. Concurrently, August 2026 gold futures saw a decrease of Rs 5,863, reaching Rs 1,40,666 per 10 grams.

The U.S. dollar has risen for three consecutive sessions, hitting a 13-month high. This strengthens the currency, making gold more expensive for international buyers and diminishing its appeal as interest rates are expected to climb.

Traders are now pricing in approximately three rate hikes this year, with a notable probability of a September increase. Historically, gold is seen as an inflation hedge, but rising interest rates reduce its attractiveness due to the lack of yield.

Analysts like Manoj Kumar Jain from Prithvi Finmart expect continued price volatility this week. They point to fluctuating crude oil prices, the dollar index, and upcoming U.S. economic data, including GDP and Core PCE price index figures, as key factors influencing the market.

Jain has outlined support and resistance levels for both gold and silver on MCX and international markets. He advises investors against aggressive buying at current levels, suggesting that the market may have entered an oversold zone and recommending the exit of short positions.

For instance, gold has support at Rs 1,40,000-Rs 1,38,800 and resistance at Rs 1,42,400-Rs 1,43,350 on MCX. Silver has support at Rs 2,09,100-Rs 2,05,000 and resistance at Rs 2,16,600-Rs 2,21,000.