Gold Prices Plunge After Record Highs: What Triggered the Sudden Downfall?

• Gold prices plummeted by up to 5.7 percent in a single day, the biggest fall since October 21, after crossing the $5,500 mark.
• Silver prices also dropped by 8.4 percent, coinciding with a sudden 0.3 percent rise in the dollar index.
• The fall is attributed to investors selling gold for cash as stock markets decline and profit-booking after an excessive rise.
• In the MCX market, Gold February futures fell by over 10,000 rupees (6%) to 1,59,250 rupees per 10 grams, and Silver March futures dropped by approximately 24,000 rupees.
• A stronger dollar, fueled by a US government shutdown agreement and Federal Reserve's interest rate decision, made gold more expensive for other currency holders, reducing demand.

Why It Matters: Gold prices crashed significantly after reaching record highs, driven by a stronger dollar and investor profit-booking.