Gold and silver prices rose in Thursday’s session, March 05, supported by safe-haven buying as tensions in the Middle East remain heated, while a stronger dollar and concerns around the US Federal Reserve’s monetary policy have capped gains. Investors are also awaiting key US economic data releases.
Gold, which usually remains hot during periods of geopolitical tensions, gained $70 per troy ounce on Comex to $5,204 per ounce on 5 March but failed to hold on to those gains as it slipped to $5,140 at the time of writing this report.
The May silver futures contract, too, pulled back to $83 after reaching an intraday high of $85.75, which was $2.60 higher than the previous close.
The US dollar index resumed its gains after a breather in the previous session. The dollar index, which measures the greenback against a basket of currencies, rose 0.4% to 99.2.
Meanwhile, initial jobless claims are due later today, while the more critical unemployment rate and nonfarm payrolls numbers are scheduled for tomorrow, which will provide cues about the US Federal Reserve’s rate-cut outlook.
War widens
The conflict in the Middle East entered its sixth day on 5 March, with Iran continuing its attacks on US military bases and key energy infrastructure in the Gulf region. The Israeli military reportedly said it launched targeted strikes in Lebanon against the Iranian-backed Hezbollah militant group in Beirut’s southern suburbs.
The tensions, which escalated after the US and Israel killed Iran’s supreme leader and top military officials on Saturday, have led to multiple consequences, including the closure of the Strait of Hormuz, which is a key route for crude oil and gas supplies to Asian countries.
The closure has led to a sharp rise in crude oil and gas prices, raising concerns among investors that higher energy prices could push up consumer inflation and force central banks to delay interest rate cuts.
Iran warned that the United States would “bitterly regret” torpedoing an Iranian warship in the Indian Ocean, while a religious leader called for “Trump’s blood,” AP reported.
Meanwhile, Tehran also dismissed a report that its Ministry of Intelligence had reached out to the US to negotiate an end to the conflict as “pure falsehood.” More than 1,000 people have reportedly died in Iran so far, along with dozens elsewhere in the region.
MCX gold and silver remain volatile
In the domestic market, the April gold futures contract on MCX jumped ₹1,617 per 10 grams to the day’s high of ₹1,63,142, but prices have cooled off to trade at ₹1,60,677.
The May silver futures contract, too, is trading at ₹2,63,644 per kilogram after touching an intraday high of ₹2,75,251. After a historic sell-off in late January, prices have staged a smart recovery, rising to ₹49,324 from recent lows.
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
