Gold Price Today Drops Amid Hawkish US Fed Outlook, Stronger Dollar; Israel-Iran Conflict

MCX Gold August futures dip 0.30% to ₹99,239 per 10 grams as Fed holds rates steady; global tensions and inflation worries remain in focus

New Delhi, June 19, 2025 – Gold prices edged lower in the domestic futures market on Thursday as a stronger US dollar and a hawkish policy stance by the Federal Reserve weighed on investor sentiment. The MCX Gold August 5 contract was trading at ₹99,239 per 10 grams, marking a decline of 0.30% from the previous close.

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The pullback in prices comes on the heels of the US Federal Open Market Committee’s (FOMC) decision on June 18 to keep interest rates unchanged in the range of 4.25% to 4.5%, in line with market expectations. However, Fed Chair Jerome Powell’s cautious tone and uncertainty around future rate cuts triggered a modest rally in the US dollar, reducing gold’s appeal.

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📊 Key Market Drivers

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• Fed Outlook: Although the Fed’s dot plot signals a potential 50 basis point rate cut in 2025, Powell warned that upcoming data—especially inflation trends—will guide future decisions.
• Stronger Dollar: The US Dollar Index gained 0.20%, making gold more expensive for holders of other currencies and thus dampening demand.
• Inflation & Tariffs: Powell also hinted that inflation may spike during summer, partly due to President Donald Trump’s new tariffs, adding more complexity to the Fed’s rate path.
• Geopolitical Tensions: The ongoing Israel-Iran conflict continues to cast a shadow over global markets, sustaining some safe-haven demand, though not enough to offset Fed-induced pressure on gold.

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📉 Outlook

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While gold continues to be a preferred hedge against geopolitical instability and long-term inflation, short-term price movement is likely to remain under pressure from a firmer dollar and interest rate uncertainty. Analysts advise tracking the Fed’s future comments and real-time inflation data closely.

Tags: Gold price today, MCX Gold, US Federal Reserve, Dollar Index, Inflation 2025, Interest Rates, Israel-Iran Conflict, Market Outlook

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