Gold prices on Monday surged following the US and Israel’s major strikes on Iran, escalating geopolitical tensions, and raising global economic uncertainty.
Spot gold had soared 1.88 per cent at $5,376.44 an ounce, as of 0632 GMT, after recording its highest point in more than four weeks. Earlier in the session, bullion prices had increased by up to 2 percent. US gold futures rose 2.7 per cent to $5,389.20 per ounce.
A day after the assassination of Khamenei sent the Middle East and the world economy into even greater turmoil, Israel launched another wave of attacks on Tehran on Sunday, and Iran retaliated with further missile attacks.
Kyle Rodda, Senior Financial Market Analyst at Capital.com., said, “Unlike previous escalations in this conflict, there is fairly strong incentive here for both sides to continue to escalate potentially – and that runs the risk of leading to a pretty chaotic, uncertain and, therefore, volatile environment for more than just a few days … the dynamic for gold is pretty positive.”
Meanwhile, the US dollar index is up 0.27 percent, making gold more expensive for overseas buyers and capping the metal’s gains.
Bullion, an old safe-haven asset, has reached new record highs this year as the world faces increased uncertainty in politics and economics.
The most recent rally is marked by a 64 percent increase in 2025, which occurred due to aggressive central bank purchases, solid inflows to exchange-traded funds, and the prospects of easing US monetary policy.
Independent analyst Ross Norman stated, “Gold is perhaps the finest barometer to reflect global uncertainty and, to mix metaphors, the mercury is rising. We should expect gold to be repriced higher to fresh records as we enter a whole new era of geopolitical uncertainty.”
However, the data on Friday reported that US producer prices increased more than estimated in January, suggesting inflation could pick up in the coming months.
A series of US labour market readings will also be monitored by investors this week, such as the ADP employment report, the weekly jobless claims, and the non-farm payrolls report.
Spot silver gained 1.3 percent to $95 per ounce, after reaching a monthly gain in February. Spot platinum was above 0.8 percent at $2,383.50 per ounce, while palladium advanced 2.3 percent to $1,826.59.
