Gold, Silver Prices To Correct As Fed Rate Hike Expectations Become Strong - Deccan Chronicle

AI desk brief

Gold and silver are framed as vulnerable to a near-term correction if the Fed delivers a 25 bp hike at its Sept. 15 meeting, with trader Ajay Kedia citing stronger US jobs data and a potentially hotter inflation print as the key trigger. He sees domestic gold sliding toward ₹1.41 lakh/10g from about ₹1.52 lakh, while silver could fall to ₹2.20 lakh/kg from ₹2.50 lakh/kg, with US prices quoted at around $4,150/oz for gold and $58/oz for silver in a hike scenario.

The article argues the setup is fundamentally negative for precious metals because higher rates would pressure non-yielding assets, though it notes recent rupee strength has also weighed on local prices. On the other hand, Kedia says any correction could become a buying opportunity, pointing to seasonal festive demand as a support once the market digests the policy event.

Near term, the key catalyst is this Friday’s inflation data and the Fed decision next week. If CPI surprises higher, the market may price a more hawkish path and extend liquidation in gold/silver; if not, the correction thesis may fade quickly. Kedia retains a bullish year-end view, calling for gold at $5,000 and silver at $90, but the immediate tone is corrective rather than trend-following.