Gold and Silver Prices Surge Over 1% Amid West Asia Conflict and Inflation Concerns


Gold and silver prices witnessed a substantial surge of over 1% on Monday, driven by escalating tensions in West Asia. This heightened geopolitical uncertainty has stoked fears of inflation and prompted investors to turn to precious metals. This article delves into the factors contributing to the surge in gold and silver prices and their potential implications.

Gold’s Safe-Haven Appeal:

Gold, a traditional safe-haven asset, has gained popularity during times of market uncertainty and inflation. The volatile situation in West Asia has intensified concerns about global economic stability, prompting investors to seek refuge in gold.

Price Movement:

In late trades in Mumbai, gold was trading at approximately Rs 57,400 per 10 grams in the spot market, marking a daily increase of Rs 900. This surge highlights the resilience of gold’s safe-haven status.

Silver’s Role as a Precious Metal:

Silver, similar to gold, possesses both precious metal and safe-haven characteristics. It is also utilized in various industrial applications, making it an attractive asset during periods of economic uncertainty.

Silver Price Increase:

Silver prices also experienced an uptick, rising to Rs 68,400 per kilogram from Rs 67,100 on the preceding Friday. This demonstrates the demand for silver as investors seek safe-haven assets.

Geopolitical Tensions in West Asia:

The increase in gold prices is attributed to heightened safe-haven bids due to the escalating tensions in West Asia, particularly the Hamas attack on Israel. Alleged Iranian involvement in the conflict has raised concerns of a potential regional conflict.

China’s Gold Reserves:

Adding to the factors influencing gold prices, there is news that China has expanded its gold reserves for the 11th consecutive month in September. The central bank of China increased its holdings by 840,000 troy ounces, contributing to the upward momentum in gold prices.

Impact on India-Israel Trade:

Beyond its impact on precious metal prices, the conflict in West Asia could significantly affect trade between India and Israel in the gems and jewellery sector. In fiscal year 2023, the gems and jewellery trade between the two countries was valued at over $2 billion, witnessing a decline of nearly 27% from the previous fiscal year.

READ MORE: Gold Prices Surge Over 1% Amid Middle East Conflict And Safe-Haven Demand


The surge in gold and silver prices amid the West Asia conflict underscores the enduring appeal of precious metals during times of geopolitical turmoil and inflation concerns. As tensions persist, these metals continue to serve as safe-haven assets for investors seeking stability in uncertain times. Additionally, the conflict’s potential implications for India-Israel trade highlight the broader economic consequences of geopolitical events on international commerce.

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