Gold Prices Rebound on Easing Inflation Concerns Amid US-Iran Diplomatic Developments

Gold Prices Surge to Rs 1.65 Lakh Per 10 Grams in National Capital

Gold prices witnessed a significant increase of Rs 300 to Rs 1,65,200 per 10 grams (inclusive of all taxes) in the national capital on Monday. This rise comes in the wake of a weak US dollar and optimism over a possible peace agreement between the US and Iran.

The yellow metal of 99.9 per cent purity appreciated by Rs 300 from Friday's closing level of Rs 1,64,900 per 10 grams. In contrast, silver prices remained unchanged at Rs 2,71,000 per kilogram.

Analysts attributed the gains in bullion prices to easing geopolitical tensions, softer Treasury yields, and a weaker dollar. However, the appreciation in the rupee capped further upside in domestic gold prices. The rupee appreciated by 35 paise to close at 95.25 (provisional) against the US dollar on Monday, marking its third straight session of gains.

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In the international markets, spot gold climbed USD 60.69, or 1.35 per cent, to USD 4,570.07 per ounce, while silver rallied more than 3 per cent to USD 78.18 per ounce.

The market's positive sentiment was driven by growing optimism about a potential US-Iran agreement, which alleviated worries about high energy prices and inflation pressures. According to reports, progress towards a diplomatic framework, including efforts to restore shipping activity through the Strait of Hormuz and ease regional tensions, supported broader market sentiment.

Looking ahead, further developments surrounding US-Iran negotiations are expected to remain the key driver for precious metals' trend this week. Continued diplomatic progress could support gold and silver by easing inflation concerns linked to energy markets, while any setback in negotiations or renewed geopolitical tensions may increase volatility and weigh on sentiment.

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