Gold prices plunged for a third straight trading day, hitting an intraday low of $3,852. The $3,900 mark has been breached again, setting a new one-year low. Domestic gold jewelry prices have followed suit, falling to 1,170 yuan per gram—more than 500 yuan below their early-year peak of 1,700. Today alone, prices dropped another 20 to 30 yuan per gram.
It’s not that gold has stopped being a safe haven—the Fed has turned hawkish. Markets are now pricing in a 25-basis-point rate hike in December, pushing up both the dollar and Treasury yields. That makes non-interest-bearing gold increasingly costly to hold. Analysts say another $3 billion in buying is waiting in the wings. Whether prices can reclaim $3,900 should become clear this week.
It’s not that gold has stopped being a safe haven—the Fed has turned hawkish. Markets are now pricing in a 25-basis-point rate hike in December, pushing up both the dollar and Treasury yields. That makes non-interest-bearing gold increasingly costly to hold. Analysts say another $3 billion in buying is waiting in the wings. Whether prices can reclaim $3,900 should become clear this week.