Gold Extends Four-Day Slide as Dollar Strength, Oil Surge Pressure Bullion

Gold prices in New Delhi fell 1,600 rupees to 1.52 lakh per 10 grams on Thursday, marking the fourth straight day of losses for the precious metal. Silver took a sharper hit, dropping 5,000 rupees to 2.37 lakh per kilogram. The twin declines reflected a broader squeeze on bullion markets: a strengthening US dollar, climbing crude oil prices, and weak signals from global trading floors all conspired to push investors away from assets that typically shine when currencies weaken or uncertainty rises.

The rupee's own slide to 95.96 against the dollar provided some modest relief to domestic buyers—a weaker home currency normally makes gold cheaper for local purchasers—but it was not enough to arrest the selling. Saumil Gandhi, a senior commodities analyst at HDFC Securities, attributed the domestic weakness to subdued retail demand and the headwinds blowing through international markets. A stronger dollar and higher US Treasury yields, he noted, continued to erode gold's appeal. When the dollar strengthens, gold becomes more expensive for foreign buyers, dampening demand. When Treasury yields rise, investors can earn better returns in bonds, reducing the incentive to hold non-yielding bullion.

The pressure was equally severe overseas. Spot gold fell nearly 1 percent to 4,253.61 dollars per ounce, while silver dropped 1.4 percent to 63.56 dollars an ounce. The US dollar index climbed above the 101 mark, approaching a two-month high. Crude oil prices surged as well, jumping to 106 dollars per barrel for Brent crude, driven by supply concerns emanating from West Asia. Praveen Singh, head of commodities at Mirae Asset Sharekhan, pointed to the oil spike as a fresh headwind for precious metals. The metal had already slipped below 4,274 dollars an ounce globally as crude leapt higher on geopolitical jitters.

Those jitters were rooted in real events. On Wednesday, a cargo vessel was struck by an unknown projectile in the Strait of Hormuz, according to the UK Maritime Trade Operations centre. Iranian President Masoud Pezeshkian told the UN General Assembly that Tehran was a victim of terrorism and would not surrender. The rising uncertainty over whether the Hormuz route—a critical chokepoint for global oil shipments—would remain open sent crude prices climbing. Analysts cautioned that sustained energy price increases could fuel inflation and leave central banks with less room to cut interest rates, a dynamic that would further weigh on gold.

Market participants are now pricing in a 70 percent probability that the Federal Reserve will raise rates at its October meeting, according to Singh. That expectation alone makes gold less attractive; higher rates increase the opportunity cost of holding an asset that produces no income. Investors were also watching a planned meeting between US President Donald Trump and Chinese President Xi Jinping at the White House, where trade, artificial intelligence, and the Iran conflict were expected to dominate the agenda. The outcome of those talks could reshape the geopolitical and economic backdrop that has been pressuring bullion for days.