Gold Prices – Bullion Surges as Middle East Conflict Deepens
Gold Prices – Gold and silver prices climbed sharply on Monday as escalating tensions between the United States and Iran unsettled global financial markets and pushed investors toward traditional safe-haven assets.
Precious Metals Rally Amid Rising Geopolitical Risk
On the Multi Commodity Exchange, gold futures for April delivery advanced 3.12 percent during intraday trade to reach Rs 1,67,155 per 10 grams. Silver futures for March delivery followed suit, rising 3.04 percent to Rs 2,91,249 per kilogram.
The gains came after fresh military developments in the Middle East intensified uncertainty. Israeli airstrikes reportedly targeted key command facilities and air defence systems in Tehran. In response, missile attacks were launched on Israeli territory and on United States military installations in the Gulf region. The escalation has heightened fears of a wider regional confrontation.
Escalation Fuels Safe-Haven Demand
Tensions spiked further after coordinated US-Israel strikes on Sunday reportedly killed Iran’s Supreme Leader, Ayatollah Ali Khamenei, marking a significant and unprecedented turn in the conflict. The development triggered a strong risk-off sentiment across global markets, as traders weighed the possibility of prolonged instability in the Middle East.
Market participants are increasingly concerned that a broader conflict could disrupt oil shipments through the Strait of Hormuz, a critical passage for global crude supplies. Any interruption in this route could have significant economic implications, adding to volatility across asset classes.
Manav Modi, a commodities analyst at Motilal Oswal Financial Services Ltd, said gold extended last week’s upward momentum amid ongoing hostilities between the US and Iran. He added that uncertainty over the tariff policies of former US President Donald Trump has further contributed to macroeconomic risks, supporting the metal’s appeal.
Dollar Strength Limits Further Gains
While bullion prices moved higher, gains were somewhat restrained by a firmer US dollar. The dollar index rose 0.24 percent to 97.85, making dollar-denominated commodities more expensive for buyers using other currencies. A stronger greenback typically acts as a headwind for gold, as it reduces purchasing power for overseas investors.
Crude Oil Jumps on Supply Concerns
Oil markets reacted sharply to the geopolitical developments. Crude prices surged more than 7 percent on fears that escalating hostilities could lead to significant supply disruptions. The possibility of prolonged instability in the Gulf region has raised concerns about energy security and inflationary pressures worldwide.
Focus Shifts to Economic Data
Beyond geopolitical headlines, investors are closely monitoring upcoming economic indicators for direction. Manufacturing Purchasing Managers’ Index readings from major economies are expected to offer insight into global growth trends. Later in the week, attention will turn to US labour market data, which could influence monetary policy expectations and shape commodity price movements.
Strong Performance in 2025
The recent rally builds on an already robust performance for gold this year. Prices have surged approximately 64 percent in 2025, supported by sustained central bank purchases, solid inflows into exchange-traded funds, and expectations that the US Federal Reserve may move toward monetary easing.
Several global financial institutions have outlined bullish projections for the metal. JP Morgan has indicated that gold could potentially reach $6,300 per ounce by the end of 2026. Meanwhile, Bank of America has suggested that prices may approach the $6,000 mark under supportive macroeconomic conditions.
As geopolitical tensions remain elevated and economic uncertainty persists, market participants are likely to continue watching both global conflict developments and key financial data releases to gauge the trajectory of precious metals and broader commodity markets.