Gold Rate Falters Amid Rising Oil Prices and Strengthening US Dollar as US-Iran Tensions Escalate

Global Markets Tumble as US-Iran War Tensions Escalate

The international gold market has taken a hit, with the COMEX gold rate crashing over $100 per troy ounce to an intraday low of $4,681.57/oz. This sharp decline comes on the heels of a strong US dollar and rising crude oil prices, which have been fueled by President Trump's address to the nation on the US-Iran war. Trump's vow to hit hard against Iran in the next few weeks has escalated tensions in the Middle East and renewed inflation fears.

The MCX gold rate today opened downward at ₹1,52,490 and touched an intraday low of ₹1,50,480 per 10 gm, losing over ₹3,000 within a few minutes of the Opening Bell. Currently, the gold price on the Indian bourse is trading around ₹1,50,750 per 10 gm level, logging an intraday loss of around ₹3,000 per 10 gm.

The sharp decline in gold prices can be attributed to the soaring crude oil prices, which have renewed inflation fears. According to market experts, the US president's address to the nation has shattered hopes of a ceasefire in the US-Iran war, leading to increased tensions in the Middle East.

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Market experts, such as Anuj Gupta, a SEBI-registered market expert, and Sugandha Sachdeva, Founder of SS WealthStreet, have predicted that gold prices will remain volatile in the near term. Expecting volatility in the gold rate today, Sachdeva said that gold rate today in India is likely to find support near ₹1,35,000 to ₹1,33,500 zone, with a strong resistance zone seen around ₹1,57,600.

Sachdeva also believes that the US Fed and other global central banks have maintained a hawkish bias amid persistent inflation risks, particularly those stemming from energy supply disruptions. This reinforces expectations of tighter monetary conditions, which remain a headwind for gold.

The uncertainty surrounding the US-Iran war has also led to a downgrade of Indian equities by brokerage firms, such as Nomura. Analysts led by Chetan Seth of Nomura have downgraded Indian equities to "neutral" from "overweight", citing elevated risks to earnings and valuations from higher crude prices.

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