Gold, silver rate outlook: Will Middle East tensions trigger a fresh bullion rally? Here's what experts say

Gold and silver prices are expected to begin the week on a strong note when trading resumes on Monday, as escalating tensions in the Middle East push investors toward safe-haven assets, analysts said.The surge in risk aversion follows US President Donald Trump’s announcement of “major combat operations” in Iran after Israeli strikes on Tehran. Iranian state media confirmed on Sunday the death of Supreme Leader Ayatollah Ali Khamenei, triggering retaliatory strikes by Iran on US military installations and Israeli targets in the region, PTI reported.Market experts said the trajectory of bullion prices will depend on the duration and intensity of the conflict, as global investors reassess risk exposure amid fears of prolonged instability.“Gold and silver prices are set to remain highly volatile with gap-up on the opening session on Monday as the Middle East conflict involving renewed US and Israeli military action against Iran -- continues to dominate global risk sentiment,” Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities, said.He added that escalating hostilities and fading hopes of a swift diplomatic resolution are driving investors towards traditional safe-haven assets. “As global equities and risk assets come under pressure, capital tends to shift into precious metals, which act as a hedge against uncertainty,” Trivedi said.The domestic commodities market will remain closed on Tuesday for Holi.On the Multi Commodity Exchange (MCX), silver futures for March delivery surged Rs 22,054 or 8.72 per cent last week, while gold futures for April delivery rose Rs 5,228 or 3.33 per cent.Pranav Mer, Vice President, EBG - Commodity & Currency Research, JM Financial Services, said bullion ended another week in positive territory, with silver rising over 8 per cent and gold gaining 3.2 per cent.“Bullion remains supported by a safe-haven bids, persistent buying from central banks and exchange-traded funds, amid rising geopolitical and economic uncertainty in the global markets,” Mer said.He noted that the recent US Supreme Court ruling against Trump’s trade tariffs, terming most of them illegal, has added to global uncertainty, with several companies filing refund lawsuits.In international markets, Comex silver futures jumped USD 10.34 or 12.55 per cent over the past week, while gold gained USD 167 or 3.3 per cent.Trivedi also pointed to energy market developments, saying rising crude oil prices due to fears of supply disruptions through the Strait of Hormuz are further supporting bullion interest.“However, the impact may not be uniform -- if over the weekend there are diplomatic developments or indications of de-escalation, precious metals could see profit-taking after an initial spike of 3-6 per cent,” he cautioned.Analysts added that macroeconomic data releases this week, including manufacturing and services PMI readings, US retail sales, non-farm payrolls and employment data, as well as Eurozone inflation and the European Central Bank meeting, will also influence global market sentiment.(Disclaimer: Recommendations and views on the stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India)