New Delhi – Gold and silver prices registered significant gains across national markets on Wednesday, driven by a substantial easing of geopolitical tensions following an agreement between the United States and Iran for a two-week ceasefire.
Information was available with The Chenab Times indicating that silver prices experienced a sharp rise of Rs 11,000, reaching Rs 2,51,000 per kilogram in the national capital. This surge represented a near 5 percent increase from the previous day’s closing price of Rs 2,40,000 per kg, as reported by the All India Sarafa Association.
Gold of 99.9 percent purity also saw a notable appreciation, climbing by Rs 3,200, or 2.09 percent, to Rs 1,56,400 per 10 grams. This follows its previous closing rate of Rs 1,53,200 per 10 grams.
Market analysts attributed the strengthened bullion prices to the de-escalation of tensions in West Asia, which catalyzed a broader relief rally across global financial markets. The positive sentiment extended to gold, which approached a three-week high. This resurgence in demand for precious metals was further supported by a pullback in the US dollar and crude oil prices.
The improved global risk sentiment followed an announcement by U.S. President Donald Trump confirming a pause in military actions. This pause was made conditional on the reopening of the Strait of Hormuz. Iran also indicated that safe passage through the vital maritime route would be facilitated during the ceasefire period, thereby alleviating supply concerns.
Internationally, spot gold recorded gains of USD 97.48, or 2.07 percent, trading at USD 4,803.33 per ounce. Concurrently, silver was trading approximately 6 percent higher at USD 77.33 per ounce.
Analysts noted that the international spot gold market experienced a significant surge following the announcement of a temporary ceasefire in the Iran conflict. This development had a cascading effect, leading to rallies in commodities, bonds, and equities.
The nearly 20 percent crash in crude oil prices, directly linked to the ceasefire announcement, is expected to reduce the likelihood of interest rate hikes by global central banks, including the U.S. Federal Reserve. This decline in energy rates contributed to the overall positive market sentiment.
Further reinforcing the market’s reaction, the U.S. dollar slipped below the 99 mark amid the relief from the U.S.-Iran ceasefire. This temporary easing of fears surrounding prolonged energy supply shocks and their subsequent inflationary impact propelled precious metal prices upward, with some reports indicating rises of up to 7 percent.
The rally in bullion prices occurred in tandem with a widespread relief rally observed across global markets. Throughout the period of conflict, gold’s role as a traditional safe-haven asset was reportedly tempered by liquidity constraints, as investors were compelled to liquidate bullion holdings to offset losses in other portfolio segments. However, the current ceasefire offers a reprieve.
Market observers cautioned that the ceasefire is conditional, and uncertainty remains regarding compliance around the Strait of Hormuz. Any indication of a breach or collapse of the agreement could rapidly reverse current market sentiment, potentially reintroducing downside risks across precious metal markets.
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The Chenab Times News Desk
