Price Of Gold, Silver Rally As US-Iran Ceasefire Announcement Eases Inflation Worries

The prices of precious metals jumped on 8 April after a temporary ceasefire was announced between Iran and the USA. As of 12.40 PM on Wednesday, the price of gold on India's Multi-Commodity Exchange (MCX) spiked 2.49% to ₹1,54,025 lakh per 10 grams, while silver futures jumped 6.07% to ₹2,45,402 lakh per kilogram.

At around 12:54 PM, MCX Gold rose by 2.47% and stood at ₹38,720, whereas MCX Silver jumped 5.95% and stood at ₹28,915. Since the beginning of the US-Iran war, the prices of gold and silver have dropped by around 10% and 17%, respectively.

Why Did Gold And Silver Prices Rise?

President Trump announced a two-week pause in US military strikes against Iran. This came just hours before his deadline for Iran to reopen the Strait of Hormuz, a route that supports the passage of nearly one-fifth of the world's oil.

Trump said Iran had shared a 10-point proposal that could lead to negotiations. In return for the ceasefire, Iran agreed to ensure safe passage for ships through the strait for the next two weeks.

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What Is the Outlook For Gold And Silver Prices?

As the ceasefire announcement brings temporary relief, gold and silver prices remain volatile in the long term. In the coming days, both precious metals are likely to swing up and down sharply.

A crucial thing to watch out for is the talks between the US and Iran. If the temporary ceasefire stays intact, gold and silver prices could benefit. But if tensions rise again, prices may climb further.

Source:

Livemint