Mumbai’s financial markets witnessed a dramatic rally in precious metals on Monday, driven by escalating tensions in the Middle East. The joint US-Israel military strikes on Iran have ignited fears of a broader regional conflict, propelling gold and silver prices up by over 3% in a single trading session.
On the Multi Commodity Exchange (MCX), April gold futures soared more than 3%, touching a daily high of 1,67,915 rupees per 10 grams. March silver futures followed suit, climbing over 3% to 2,85,978 rupees per kilogram, marking the session’s peak.
By mid-morning around 10:46 AM, gold for April 2 expiry was trading at 1,66,716 rupees per 10 grams, up 2.85% or 4,612 rupees. Silver for March 5 expiry stood at 2,82,309 rupees per kilogram, reflecting a 2.66% gain of 7,311 rupees.
The surge comes amid retaliatory missile strikes by Iran on Israeli territories and US bases in the Gulf, following Israel’s precision attacks on Tehran’s command centers and air defenses. Tensions skyrocketed further after reports confirmed the death of Iran’s Supreme Leader Ayatollah Ali Khamenei in Sunday’s joint US-Israel operation.
Markets shifted into risk-averse mode, with investors piling into safe-haven assets amid concerns over disruptions in crude oil supplies through the Strait of Hormuz. Manav Modi, commodity analyst at Motilal Oswal Financial Services, noted, ‘Gold has extended last week’s gains amid the US-Iran war, compounded by uncertainties from President Donald Trump’s tariff policies.’
The dollar index edged up 0.24% to 97.85, making dollar-denominated gold costlier for non-US investors and slightly capping the rally. Crude oil prices jumped over 7%, fueled by fears of supply interruptions from the conflict.
Investors now eye key manufacturing PMI data from major economies and upcoming US labor market figures, which could dictate market direction this week. This rally builds on gold’s staggering 64% rise in 2025, powered by central bank buying, ETF inflows, and expectations of US monetary easing.
JPMorgan forecasts gold could hit $6,300 per ounce by end-2026, while Bank of America predicts $6,000 per ounce, underscoring the metal’s bullish outlook in turbulent times.