Storm Incoming! Gold Prices Plummet, Fall to Lowest Level in a Month

Jakarta, CNBC Indonesia - Gold prices took a battering during Wednesday’s trading after the announcement of the US Federal Reserve’s decision.

According to Refinitiv, gold prices closed at US$4,817.63 per troy ounce on Wednesday (18/3/2026). The price plunged 3.73%.

This price marks the lowest level since 5 February 2026, or more than a month ago (US$4,769.89). The 3.7% weakening on the previous day also became the deepest since 5 February 2026 (3.87%).

Gold prices began to recover today, Thursday (19/3/2026). On Thursday at 06:24 WIB, gold was traded at US$4,832.52 per troy ounce, up 0.31%.

Gold faced selling pressure after Federal Reserve Chair Jerome Powell stated that rising energy prices would drive overall inflation higher.

Higher inflation rates would make it more difficult for the Fed to accelerate rate cuts. As a result, demand for the US dollar would strengthen again.

Gold purchases are denominated in US dollars, so the strengthening of the US currency would pressure gold buying.

The dollar index surged to 100.86 during yesterday’s trading from its previous level of 99.

The Fed again held interest rates steady at 3.50-3.75% during this week’s Tuesday-Wednesday meeting, or early Wednesday and Thursday Indonesian time.

This is the second consecutive meeting without changes, amid economic uncertainty triggered by the ongoing Iran war and persistent inflation.

The central bank also signalled that it would implement one rate cut this year, although market participants have begun reducing expectations for rate cuts in 2026.

These rate cut expectations are fewer than previously anticipated, namely two times. With only one cut, the current interest rate level is likely to persist for a long time.

“Powell slightly pulled back his statement, which was not as hawkish as feared, but still emphasised the dual mandate by keeping rates tight for longer,” said Nicky Shiels, head of metals strategy at MKS PAMP SA, quoted from FX Street.

On the other hand, escalating tensions in the Middle East could drive funds into safe-haven assets, benefiting precious metals.

Iran and Israel have exchanged attacks on major energy facilities in the region.

These attacks occurred after a warning from Iran’s Army Chief, Amir Hatami, who vowed to launch a “firm and painful” retaliation over the death of security official Ali Larijani in an Israeli airstrike.