Domestic gold prices exhibited a positive trend during the opening trade on Monday, influenced by the ongoing tensions between the US and Iran, as well as President Donald Trump’s announcement of a 15% global tariff. This comes in the wake of the Supreme Court’s decision on Friday to invalidate extensive tariffs, thereby enhancing the allure of gold and silver as safe-haven assets. The April gold futures on the MCX were trading at Rs 1,60,600 per 10 grams around 9:05 am, reflecting an increase of Rs 3,700 or 2.4% from the previous Friday’s close. Meanwhile, March Silver contracts were trading at Rs 2,68,120 per kg, reflecting an increase of 6% or Rs 15,200.
The prices of the yellow metal on COMEX increased by more than 2%, amounting to $109, with trading occurring at $5,189.60 per ounce at this time. Silver rate stood around $87.505, experiencing a notable increase of $5.16 or 6% per ounce. Gold prices have declined by 18% or Rs 36,000 from their peak of Rs 1,93,096 following a remarkable rally in 2025 that extended into January. Similarly, silver is experiencing consolidation, having declined significantly (40% or Rs 1.68 lakh) from its peak of Rs 4,20,048. The persistent US-Iran standoff exerts significant pressure on global equity markets, as demonstrated on Thursday when Indian indices experienced notable selling activity.
On Friday, Trump reiterated his warning to Iran, indicating that military action may ensue if Tehran does not “better negotiate a fair deal.” The USS Gerald R. Ford aircraft carrier has made its way into the Mediterranean Sea as of Friday, following directives from President Donald Trump, which align with a larger US military escalation in the Middle East. The carrier was observed transiting the Strait of Gibraltar, a crucial conduit linking the Atlantic Ocean with the Mediterranean Sea. In a significant ruling, the United States Supreme Court declared Trump’s ‘Liberation Day’ tariffs to be illegal, emphasizing that he exceeded his authority. In the wake of the decision, Trump executed documents to implement a 10% tariff on imports from all nations, asserting that it would be “effective almost immediately.” On Saturday, he increased the tariffs to 15%.
In February, bullion prices exhibited significant volatility, prompting both MCX and NSE to raise margin requirements. However, they experienced a significant boost last week following the announcement from MCX and the National Stock Exchange of India regarding the withdrawal of additional margins on gold and silver futures contracts, effective Thursday, February 19. The elimination of the supplementary 3% margin on gold and 7% on silver reduces capital requirements for traders, enhancing capital efficiency, especially for those utilizing leverage. Generally, reduced margins stimulate increased speculative engagement, the establishment of new long and short positions, and heightened intraday trading, thereby enhancing liquidity in gold and silver futures.