Key Highlights
- Gold and silver prices declined in global markets
- Fresh US strikes on Iran increased geopolitical tensions
- Strong US dollar pressured precious metal prices
- Rising crude oil prices revived inflation concerns
- Investors cautious over US Federal Reserve policy outlook
- Gold expected to remain volatile amid Middle East uncertainty
New Delhi: Gold and silver prices declined sharply in global markets on Thursday after fresh US military strikes on Iran strengthened the US dollar and reignited concerns over prolonged geopolitical tensions and inflation risks.
Spot gold slipped below the $4,420 per ounce mark, while silver prices also witnessed heavy selling pressure as investors reassessed expectations around US Federal Reserve interest rate policy and rising energy costs.
Market sentiment turned cautious after reports emerged that the United States carried out overnight strikes targeting Iranian military infrastructure linked to threats near the Strait of Hormuz. The escalation triggered a sharp rise in crude oil prices, reviving fears that inflation could remain elevated globally.
Analysts said the stronger US dollar became one of the biggest reasons behind the fall in bullion prices. Since gold and silver are priced in dollars, a stronger greenback makes precious metals costlier for investors holding other currencies, reducing demand.
Although gold is traditionally considered a safe-haven asset during periods of geopolitical uncertainty, rising oil prices and inflation concerns are currently limiting investor appetite for bullion. Traders fear that central banks, particularly the US Federal Reserve, may keep interest rates higher for longer if inflationary pressures continue rising.
Recent comments from Federal Reserve officials have also added to market uncertainty. Policymakers signaled caution over cutting rates too aggressively, citing inflation risks linked to geopolitical tensions, tariffs and energy prices.
Meanwhile, crude oil prices moved higher after the latest Middle East developments, increasing worries about transportation and manufacturing costs globally.
Experts believe gold and silver could remain volatile in the near term as investors continue monitoring US-Iran tensions, crude oil prices, inflation data and upcoming signals from the Federal Reserve.
