Gold And Silver Prices Rise On MCX As Middle East Conflict Boosts Safe-Haven Demand

Gold and silver prices went higher on the Multi Commodity Exchange (MCX) on March 5, driven by tensions between the U.S., Israel, and Iran, and changes in the value of the U.S. dollar and the global economy.

MCX gold April futures rose by more than ₹1,600, or about 1%, to ₹1,63,142 per 10 grams in morning trade on March 5, according to exchange data. MCX silver May futures also advanced sharply, climbing nearly ₹8,700, or about 3.3%, to ₹2,74,251 per kilogram.

In the previous trading session, MCX gold April futures had settled at ₹1,61,525 per 10 grams, up 0.30%, while MCX silver May futures closed almost unchanged at ₹2,65,560 per kilogram, based on MCX data.

Global Bullion Prices Also Move Higher

International bullion prices also recorded gains during early trading hours. Spot gold rose 0.8% to $5,176.69 per ounce, while spot silver climbed 1.2% to $84.43 per ounce at 0101 GMT, according to global market data. U.S. gold futures for April delivery were also higher by about 1% at $5,186.30 per ounce.

The increase in bullion prices coincided with rising geopolitical tensions in the Middle East. As per the reports of the US Central Command, nearly 2,000 targets, including missile sites, naval sites, and intelligence sites, in Iran have been hit since the military operation commenced.

The conflict between Iran and the US has also brought into the spotlight the implications of the conflict on the international energy supply routes. Iran has declared the closure of the Strait of Hormuz, which is one of the vital international waterways for oil supplies. This has caused volatility in commodity markets, as reported by international media outlets.

Currency And Economic Data In Focus

Movements in the U.S. dollar also influenced bullion prices. The dollar index rose 0.20% to 98.98 on March 5, according to market data. A stronger dollar typically makes commodities priced in dollars more expensive for buyers using other currencies.

Market participants are also tracking upcoming U.S. economic indicators that could influence currency and interest rate expectations. Weekly U.S. jobless claims data is scheduled for release later on March 5, while the U.S. employment report for February is expected on March 6, according to the U.S. Department of Labor.

Data from CME Group’s FedWatch Tool shows that market participants currently expect the U.S. Federal Reserve to maintain interest rates at its March policy meeting.

The combination of geopolitical developments, currency movements and upcoming economic data has led to increased activity in bullion markets. Prices of gold and silver on the MCX continued to reflect these global factors during trading on March 5.