Gold prices rallied on the Multi Commodity Exchange (MCX) on Tuesday, with June futures climbing more than ₹2,000 or 1.3% to settle at ₹1,53,699 per 10 grams in early trade. The surge comes as the US dollar weakens following the extension of ceasefire talks with Iran, reducing safe-haven demand for the greenback.
Silver also witnessed strong gains, with May futures jumping over ₹4,700 or nearly 2% to reach ₹2,49,423 per kilogram, tracking gold’s upward momentum.
The price movements reflect a broader shift in global commodity markets. The weakening dollar typically makes gold more attractive for international buyers, as it becomes cheaper for holders of other currencies. Additionally, crude oil prices declined following the diplomatic developments, which eased geopolitical tensions and reduced inflation concerns.
The extension of US-Iran ceasefire negotiations signals reduced immediate conflict risks in the Middle East, a key oil-producing region. This development has cooled crude prices, potentially lowering inflation expectations and supporting gold’s appeal as an inflation hedge.
Market analysts note that the inverse relationship between the dollar and gold prices remains a key driver. As the greenback weakens, gold becomes more competitively priced in global markets, encouraging both domestic and international demand.
Investors tracking commodity markets should monitor currency movements and geopolitical developments for further cues on precious metal price trajectories.
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