Gold prices fell sharply after the U.S. Consumer Price Index (CPI) report for September showed inflation was stronger than anticipated. Annual inflation accelerated to 3.7%, beating market expectations of 3.6%, while core inflation also exceeded forecasts. This data has intensified investor expectations that the Federal Reserve will pursue further interest rate hikes to manage inflation. Higher interest rates increase the opportunity cost of holding non-yielding assets like gold, thus reducing its appeal for investors and putting downward pressure on its price.