Silver recovers ₹8,500 from day's low, Gold rebounds 0.7% amid US-Iran war uncertainty: What's next?

Silver rate today: Silver prices recovered on Thursday amid continuing uncertainty regarding the US-Iran war. However, a stronger dollar and fading hopes of near-term interest rate cuts continued to keep the gains capped. Gold prices also reboounded.

Silver prices jumped ₹8,500, or 3.2%, rising from the day’s low to a high of ₹2,74,665 per kg. The metal was also 2.3% higher compared with the previous close. Meanwhile, gold prices climbed ₹1,915, or 1.2%, from the day’s low to touch ₹1,62,991 per kg, marking a 0.7% gain from the previous session’s close.

In early deals, MCX silver rate fell 0.86% to ₹2,66,174 per kg while MCX gold price was down 0.4% to ₹1,61,081 per 10 grams.

Spot silver rose 0.3% to $86.06 per ounce. Spot gold was down 0.2% at $5,167.15 per ounce as of 0718 GMT. U.S. gold futures for April delivery fell 0.1% to $5,173.10.

Among other precious metals, Spot platinum gained 0.3% to $2,176.14, while palladium rose 0.9% to $1,651.11.

What drove the fall in prices?

The fall was mainly led by a firm dollar. The U.S. dollar firmed 0.2%, making dollar-priced bullion more expensive for holders of other currencies.

Moroever, Iran warned that the world should brace for $200-a-barrel oil after its forces struck merchant ships on Wednesday, while the International Energy Agency urged a massive release of strategic reserves to counter one of the worst oil shocks since the 1970s.

Now in its 13th day, the US-Israeli war with Iran continues to disrupt oil production and refining activity across the Middle East. Oil prices rose over $100 a barrel, adding to inflation pressures, as Iran stepped up attacks on oil and transport facilities across the Middle East.

Tankers in the strait have remained stranded for more than a week, and producers have suspended output as storage facilities near capacity while Iraqi security officials also informed that Iranian explosive-laden boats struck two fuel-oil tankers.

On the macroeconomic front, the US consumer price index rose 0.3% in February, matching forecasts and accelerating from January’s 0.2% increase. On an annual basis, CPI increased 2.4% in the year to February, also in line with expectations. The inflation data dampened expectations of interest rate cuts by the US Federal Reserve.

Investors are now awaiting the release of January’s delayed Personal Consumption Expenditures (PCE) index on Friday.

Silver, gold prices: What's next for the precious metals?

Precious metal prices are navigating a tug-of-war between safe-haven demand triggered by geopolitical tensions and pressure from a stronger US dollar and rising Treasury yields, said Renisha Chainani, Head of Research at Augmont.

Renisha Chainani said, “Gold and Silver prices are currently influenced by competing macro forces. On one side, escalating geopolitical tensions in the Middle East are sustaining demand for safe-haven assets. On the other hand, the strengthening U.S. dollar and rising Treasury yields are limiting the metal’s upside, as higher yields increase the opportunity cost of holding non-yielding assets like gold.”

For silver, Chainani said the metal remains on a strong footing after reaching the $90 mark and continues to show upward momentum. She indicated that the next upside target is around $95, which is roughly ₹2,85,000. On the downside, strong support is placed near $80, or around ₹2,60,000, suggesting that any short-term corrections could attract fresh buying interest.

On gold, Chainani maintained a bullish outlook, noting that prices are expected to move towards $5,250, equivalent to around ₹1,63,500, and $5,300, or approximately ₹1,65,000, in the near term. She added that strong support is seen around the $5,000 level, or about ₹1,58,500, which is likely to act as a key buying zone if prices witness corrective dips.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.