Geopolitical Tensions Spark Sharp Rally in Precious Metals
Rising geopolitical tensions and a renewed wave of safe-haven buying propelled precious metals sharply higher on Thursday, with silver experiencing a dramatic surge in the domestic market while gold continued its upward trajectory. This movement reflects heightened investor caution amid global uncertainties.
Silver Prices Skyrocket in National Capital
In the national capital, silver prices witnessed a significant jump, increasing by Rs 18,000, or 7.32 per cent, to reach Rs 2,64,000 per kilogram. This price includes all applicable taxes. The white metal had previously closed at Rs 2,46,000 per kg on Wednesday, as reported by local market sources via PTI.
Gold Also Advances Amid Firm Global Trends
Gold of 99.9 per cent purity also saw gains, rising by Rs 1,950, or 1.24 per cent, to trade at Rs 1,58,650 per 10 grams. This price is inclusive of all taxes, compared to Rs 1,56,700 per 10 grams in the previous session. The rally was supported by firm trends in international markets.
In overseas trading, spot silver was up 1.03 per cent at $77.97 per ounce, while gold hovered marginally higher at $4,991.24 per ounce, indicating a broad-based uptick in precious metals.
Analysts Point to Geopolitical Risks and Safe-Haven Demand
Saumil Gandhi, Senior Analyst - Commodities at HDFC Securities, highlighted the drivers behind the surge. "Gold prices rose to around $5,000 per ounce on Thursday, supported by a renewed wave of safe-haven demand amid rising speculation over potential US military action against Iran, which has elevated geopolitical risk," he explained.
Gandhi added that stalled Russia-Ukraine negotiations have further contributed to global uncertainty, encouraging investors to shift allocations toward defensive assets. "With geopolitical flashpoints intensifying, capital is rotating out of risk-sensitive assets and into traditional safe-haven assets, providing sustained support to gold prices," he noted.
Market Watchers Eye Key Economic Data
Renisha Chainani, Head - Research at Augmont, emphasized that investors are closely monitoring upcoming macroeconomic triggers. These include US GDP data and Personal Consumption Expenditures (PCE) inflation numbers, which are expected to shape the Federal Reserve’s interest rate outlook in the coming months. Such data could influence future price movements in precious metals.
The combined effect of geopolitical tensions and economic indicators is creating a volatile environment, driving increased interest in silver and gold as protective investments. This trend underscores the metals' role as hedges against instability in global markets.
