Gold prices on the Multi Commodity Exchange (MCX) in India surged over 2% on Monday, reaching ₹1,53,829 per 10 grams for August futures, following an initial peace agreement between the US and Iran. Silver prices also jumped by 2.18%, opening at ₹2,51,563 per kg for July futures. The rally in domestic bullion prices came after global gold prices climbed sharply amid easing geopolitical tensions.
The price increase followed the announcement of a peace framework between US and Iranian officials aimed at ending their conflict, halting the US blockade of Iran, and reopening the Strait of Hormuz. This development caused oil prices to drop over 4% and the US dollar to weaken, factors that typically support higher gold prices. The deal is set to be officially signed on Friday in Switzerland, according to Pakistani Prime Minister Shehbaz Sharif's statement on social media.
The rise in gold and silver prices reflects broader market reactions to geopolitical stability and lower inflation concerns. Gold spot prices reached $4,297.42 per ounce, the highest since June 9, while US gold futures for August delivery rose 1.9% to $4,318.10. The easing of tensions in the Middle East has reduced fears of supply disruptions, leading to lower oil prices and supporting precious metals as safe-haven assets in India and globally.
The official signing of the peace deal on Friday in Switzerland is expected to further influence commodity markets. Meanwhile, the MCX gold futures contract for August and silver futures for July remain closely watched indicators of investor sentiment in India’s bullion market.