Silver Price Surges Amid Dollar Decline and Oil Price Rebound on US-Iran Diplomatic Developments

Global Market Watch

Silver prices in India and globally surged on Thursday, driven by a weaker US dollar and declining crude oil prices. Investors were optimistic about a potential resolution to the US-Israeli war with Iran, despite renewed tensions in the region. The MCX silver rate rose 0.3% to ₹2,63,711 per kg, while the MCX gold price remained flat at ₹1,54,332 per 10 grams.

The spot silver price climbed 0.6% to $73.13 per ounce, while spot gold rose 0.7% to $4,461.09 per ounce. US gold futures for August delivery gained 0.5% to $4,487.90. The US dollar's decline made dollar-denominated bullion cheaper for holders of other currencies, boosting demand for precious metals.

Market participants were closely monitoring developments in the Middle East, where Iran's foreign minister stated that there had been "no tangible progress" in negotiations aimed at ending the conflict. However, US President Donald Trump expressed optimism, telling reporters at the White House that a breakthrough "could happen...over the weekend."

Read also: MCX Gold Price Surpasses ₹1.59 Lakh per 10 Grams, Silver Gains Amid Hopes for US-Iran Diplomatic Resolution

The ceasefire agreement between Israel and Lebanon added to hopes of a broader de-escalation in the region. The Republican-controlled US House of Representatives approved a resolution aimed at preventing President Donald Trump from continuing the war against Iran, highlighting growing concerns among members of his own party.

Oil prices also declined, with Brent crude futures falling 0.69% to $97.14 per barrel and US West Texas Intermediate crude declining 0.65% to $95.40 per barrel. The decline in oil prices was closely watched by gold investors, as elevated energy costs can fuel inflation and force central banks to maintain higher interest rates.

New York Federal Reserve President John Williams stated that he does not expect inflationary pressures arising from the Middle East conflict to persist for an extended period. Williams reiterated that there is currently no need for the Federal Reserve to alter its monetary policy stance.

Read also: Gold and Silver Prices Remain Steady Across Major Indian Cities, June 4 Update

Renisha Chainani, Head - Research at Augmont, expects Silver to remain range-bound between $72 and $78.50, with a potential climb toward the upper boundary. For gold, Chainani noted that it has been staying range-bound between $4,450 and $4,600, with prices expected to advance toward the upper edge.