Gold and Silver Prices Dip Amid Middle East Tensions and Interest Rate Concerns
Gold and silver prices fell due to Middle East tensions and rising interest rate fears, with significant declines observed in both global and domestic markets.
New Delhi, October 21 (Daily Kiran) : Gold and silver prices faced downward pressure on October 21, 2026, due to escalating tensions in the Middle East, a strong dollar, and concerns over potential interest rate hikes by the U.S. Federal Reserve. This marked a challenging day for both precious metals across global and domestic commodity markets.
On the international COMEX market, both gold and silver experienced declines. As of the latest reports, gold was trading at $4,133 per ounce, down 0.23%. Silver also saw a drop of 1.03%, trading at $57.405 per ounce.
The weakness in international markets was mirrored in India. In the domestic market, gold prices fell to ₹1.46 lakh per 10 grams, while silver reached ₹2.09 lakh per kilogram.
On the Multi Commodity Exchange (MCX), gold for December delivery was down by ₹519, or 0.35%, trading at ₹1,46,000 per 10 grams. During the day, gold opened at ₹1,46,328 per 10 grams, slightly lower than its previous close of ₹1,46,519, and later fell to a day low of ₹1,45,689 per 10 grams.
Silver on MCX also dropped, down by ₹2,267, or 1.07%, trading at ₹2,09,218 per kilogram. It began the day at ₹2,10,400 per kilogram, down from the previous close of ₹2,11,485, and hit a low of ₹2,08,801 per kilogram during trading.
Experts noted that recent instability in the Strait of Hormuz and regional tensions had driven up crude oil prices. Additionally, U.S. President Donald Trump’s decision to remove extra tariffs on major buyers of Russian energy drew attention in global commodity markets. In this climate, investors are closely monitoring safe-haven investments and signals related to interest rates.
Market analysts are particularly focused on the upcoming Federal Reserve policy meeting scheduled for October 27-28. Current estimates suggest a 16% chance of an interest rate hike in October, with a 90% probability expected in December.
Economic experts indicate that rising interest rates typically diminish the appeal of non-yielding assets like gold. This has led investors to adopt a cautious stance regarding new purchases. Moreover, a recent stabilization of the dollar index has further limited support for gold demand.
In the coming days, the direction of gold and silver prices will largely depend on U.S. economic data. Investors are awaiting the release of the Personal Consumption Expenditures (PCE) inflation figures next week, as the Federal Reserve closely monitors these indicators to control inflation.
Analysts believe that if inflation exceeds expectations, the likelihood of interest rate hikes may increase, continuing to exert pressure on gold and silver prices. Conversely, any signs of easing inflation could lead to a resurgence in demand for these precious metals.
