Precious metals are again trending up as the US-Israel conflict with Iran seems to reach no end. The prolonged conflict across West Asia has boosted the safe-haven demand for gold and silver, as both the assets extended gains in today’s trade.
The dollar index too retreated from its record highs, which further lent support to the precious metals, as a soft dollar makes assets like gold and silver less expensive for overseas currency holders, which further increases its demand.
Gold, silver benefit from soft dollar
In international markets, spot gold is trading near the $5,183 per troy ounce mark, while spot silver is quoted towards the $85 per troy ounce mark.
“Gold rose to about $5,170/oz, building on the prior session’s advance as investors sought safety amid escalating tensions in the Middle East. The conflict entered a sixth day, with US and Israeli forces striking targets across Iran and Tehran retaliating with missile attacks on several neighboring states, including key energy facilities.” Jigar Trivedi, Senior Research Analyst at Indusind Securities said.
”Silver also benefited from the dollar’s retreat following reports that Iranian operatives had reached out to the US to explore potential peace talks, though Tehran later denied the outreach. Inflation concerns eased further as the Trump administration moved to reassure markets over commercial activity in the Gulf.” Trivedi added.
MCX gold and silver prices
On MCX, the April delivery contract for gold was trading at Rs 1,62,352 per 10 grams, up 0.5% from its previous close. The May delivery contract for silver was priced at Rs 2,70,556 per kg, up nearly 2% from its previous close.
“MCX Silver May futures may appreciate Rs 269,000/kg as prices have rebounded in the global markets too.” Trivedi added.
Rate cut expectations and tariff concerns
Additionally, US President Donald Trump officially nominated Kevin Warsh as the next chair of the US central bank, which likely weighed on the market sentiment. Warsh is known for his rate cut friendly stance.
Bullion tends to perform well in lower interest rate environments. Meanwhile, economic tensions added to the price pressure for gold and silver as US Treasury Scott Bessent on Wednesday said that an increase of global import tariffs to 15% from 10% may be implemented later this week.
Safe haven demand continues to push precious metals
The escalations in the US-Iran war are keeping precious metals, as a US submarine sank an Iranian warship off the coast of Sri Lanka. US Secretary of Defence Pete Hegseth claimed it was “the first sinking of an enemy ship by a torpedo since World War Two”.
The attack comes as reports indicated that Mojtaba Khamene, the son of the slain Supreme Leader Ayatollah Ali Khamenei, has emerged as the frontrunner to be the country’s next supreme leader.