Gold and silver prices saw a significant rise of over 3% on Monday as tensions escalated between the US and Iran, with Israeli strikes on Iran and US bases in the Gulf boosting safe-haven demand.
MCX gold April futures surged by 3.12% to Rs 1,67,155 per 10 grams intraday, while MCX silver March futures also climbed by 3.04% to Rs 2,91,249 per kg.
The Israeli strikes on Tehran, which targeted command centers and air defenses, led to retaliatory missile attacks on Israeli territory and US bases in the Gulf, heightening uncertainty in the region.
The recent surge in gold prices was attributed to the US-Iran conflict and concerns over US President Donald Trump’s trade policies, according to Manav Modi, a commodities analyst at Motilal Oswal Financial Services Ltd.
The dollar index rose by 0.24% to 97.85, making gold more expensive for buyers in other currencies, thereby limiting further gains in the precious metal.
Crude oil prices also spiked by over 7% amid fears that the US-Iran conflict could disrupt the regional supply chain, leading to a major supply shortage.
Investors are now closely watching for manufacturing PMI releases from key economies, with the US labor market data expected to influence market direction this week.
The recent rally in gold follows a 64% surge in 2025, driven by increased central bank purchases, strong inflows into exchange-traded funds, and expectations of US monetary policy easing.
Financial institutions like JP Morgan predict gold could reach $6,300 per ounce by the end of 2026, while Bank of America anticipates a rally towards the $6,000 mark.
